Last week, it was reported in CE Pro that HP would abandon its Digital Entertainment Center (DEC) business in favor of the company’s proprietary MediaSmart HDTVs. The HP DEC concept was a home theater PC that ran Windows Media Center software and which would be a digital "hub" for music, TV, and movies.

No particular explanation was given for HP’s decision, but the probable cause was a combination of price (too expensive and initially targeted at the home theater market) and disinterest on the part of the general public.

Microsoft has been trying for many years to centralize the storage and playback of media in the home, a concept that runs counter to how most of us actually go about watching TV and movies and listening to music. The paradigm we’re used to requires little interactivity and complexity - we turn on the TV, and watch. Or we pop in a CD, and listen. It’s worked pretty well for several decades now.

We certainly don’t need to boot up an operating system, operate a keyboard, and start waving a wireless mouse to catch the latest episode of Heroes or listen to All Things Considered on NPR. But the folks in Redmond don’t seem to get this, and are determined to make the PC an integral part of home entertainment, based on their vision of how such a product should work.

There were several knocks against HP’s DEC product and Media Center PCs in general, one of which is the elimination of component AV systems in favor of a do-it-all server, stereo amplifier, Web browser and TV/radio tuner.

Good luck getting that past the high-end audio crowd, who’ll spend thousands of dollars on discreet receivers, preamplifiers, speakers, and wiring, not to mention spend hours debating the relative merits of one component versus another (and constantly upgrading those individual components!).

As for time shifting, that’s already available in cable and satellite set-top HDTV receivers, not to mention TiVo’s new Series 3 ATSC/NTSC STB/DVR. And serving up music? Well, Apple has captured a pretty good chunk of that business with portable MP3 players that can be docked when needed.

HP’s statement that "…this not a statement about Media Center PCs. It doesn’t mean Media Center isn’t going to be successful. It’s just that we’re discontinuing development" rings a bit hollow. Obviously, HP felt that Media Center was not worth the time and trouble to market, and that they’d have better luck with a simpler, integrated HDTV with a media server and IP/Web interfaces - such as their MediaSmart HDTVs.

Problem is; anyone can build a product like MediaSmart into an HDTV these days. All you need do is support the appropriate digital media delivery and playback formats (ATSC, IPTV, MP3, QuickTime, etc), include a Web interface, and you can use any OS you like. The user interfaces remain the same - an appropriate remote control and simple GUI.

In fact, there are thousands of kit-bashed home entertainment center PCs - all running Media Center - in daily use that were put together for far less cash than off-the-shelf "name brand" products. If there really was serious demand for such products, then TiVo’s receivers would be selling like hotcakes - but they’re not.

The TiVo human interface is one of the best I’ve ever seen for a media server, and there have been models (such as Humax’ DRT800) that included DVD recorder/player functions and CD playback. But none of those really captured the public’s imagination because they were too expensive ($400) to start with, and required an additional subscription on top.

How about internal DVRs? They haven’t exactly been setting sales records, either. LG offers four plasma HDTVs with include time-shifting capability, an idea that won a CES Innovation award a couple of years ago. However, that product line wasn’t expanded for 2007, and no other manufacturers have jumped in with comparable offerings. RCA’s Web browser-enabled HDTVs also faded away, as did Epson’s LivingStation.

For now, companies like Motorola, Scientific Atlanta, DirecTV, Dish, AT&T (SBC), and Verizon remain very much in the driver’s seat with multi-function set-top (or set-bottom) boxes. And their business model of "media on demand" obviates the need for optical disc playback - cable and DBS customers can access TVs shows and other media when they want it, or time-shift it for later viewing.

Microsoft needs to move past the idea that a PC is central to the mass-market home entertainment experience, because it isn’t. Those consumers aren’t obsessed with storing stacks of movies and CDs on computer for later retrieval and delivery to any room in their house.

They are, however, comfortable with the concept of separate AV components, any of which can be upgraded and interchanged, just as long as the interfaces are simple to connect and work reliably.

And if their cable, IPTV, or DBS service provider decides to add MP3 storage and playback or Web interfaces for downloading YouTube clips, all that customer needs do is swap out their set-top box - not boot up an operating system, connect a keyboard, or download software updates…