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New York: There seems to be a new deal between some media and consumer electronics companies every week to send movies and home-made videos straight from the internet to TV screens.
From household names like Apple Inc and Micro-soft Corp to lesser knowns such as Akimbo and Monsoon, companies are angling to make it easy for consumers to get everything from YouTube clips to Lord of the Rings via a high-speed internet link, often called PC-to-TV or IPTV.
But for stock punters looking to gain exposure to the nascent business, analysts say solid returns may not come for years, and a safer bet for investment portfolios would be to pick established names like Apple, or Cisco. Both stocks traded nears 52-week highs last Monday, with Apple shares at $123.11 and Cisco shares at $26.37.
The Apple TV set-top box links TVs to personal computers and can access shows users have downloaded, as well as video from iTunes and YouTube.
Cisco Systems Inc and rivals like Alcatel-Lucent and Juniper Networks help to make the equipment that directs traffic over the digital highway. That makes them a better place for investment over startups or niche players, said Tom McIntyre, chief portfolio manager for McIntyre, Freedman & Flynn.
"There is no question that IPTV is coming. As far as an investment I would not go too far down the chain," he said. "I would stick with the big boys, because they will never get out muscled to that gold pot."
Near term, many hurdles exist for the IPTV business, including consumer apathy, development and content costs, and a complex assembly of gadgets that can clutter living rooms.
Apple's set-top box has an early advantage, experts say, although sales forecasts differ on its initial popularity.
For example, Bernstein's Toni Sacconaghi said Apple could sell up to 500,000 units of the $300 device in its first year, while Chris Crotty of iSuppli saw 2007 shipments at one million.
"Apple TV will be the dominant device for a while because it will just work," said Yankee Group analyst Josh Martin. "It's not cheap, but Apple has a zealotry around it and fans will buy Apple TV."
Drawbacks
But Apple TV is not without drawbacks. The iTunes store's selection of movies is limited and of lower quality than alternatives such as DVDs or some on-demand cable offerings.
"In the longer term all these issues will eventually be resolved," Bernstein's Sacconaghi said in a note.
There is no shortage of companies working on IPTV systems. Itis like a gold rush with outfits hoping to claim a stake in a market that is the natural progression of online video, with tremendous growth potential. Many names are familiar. TiVo Inc runs a system called Amazon Unbox, which lets consumers rent or buy video from Amazon.com and watch it on a home TV connected to a TiVo set-top box. In addition, TiVo's partnership with One True Media allows users to watch their own home movies on TVs.
Microsoft's Xbox and Sony Corp's PlayStation 3, primarily interactive game consoles, can also download movies and video. Sony introduced earlier this year a TV that can receive programmes from the web.
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