I have one of these systems, or I should say that a family member has one, being and employee of Microsoft. While I don’t think it’s the be-all and end-all of the concept, I do think the basic idea is not a bad one.
Our setup involves one main PC, a fairly powerful one, and an extender box which allows all the media center functions to operate on a second TV elsewhere in the house (like with any such system that requires a tuner, it’s limited to one channel per household unless we buy a second tuner for the second Tv).
The main PC is hooked up to our widescreen Tv, which you can, like with most computers, use as your main monitor (which aint great for lots of text, but fine for TV/videogame content. You can play DVDs off the computer onto the Tv obviously. I particularly enjoy playing PC games on the widescreen (Day of Defeat Source is gorgeous), but since you can do this with any computer, that’s beside the point.
Media center is just like an application on the computer, displayed on your TV, and it can run fullscreen or in a window on the desktop (so you can watch TV and do other stuff). Media center, which works off a remote control as well as mouse input, is basically a front end to all sorts of media content. You can listen to and record radio. You can use the computer HD as DVR and watch your recorded shows and movies, and it has a full guide system and so forth: all the usual DVR bells and whistles. You can look through picture albums. You can listen to your music albums and buy music. All of this is basically a TV-like front end to stuff you can do on a computer. And the extender basically allows you to do all this from the other TV as well (so someone can look through a picture album that’s on the computer while I watch TV on the same computer, or they watch a recorded show while I watch Live Tv and surf the web at the same time, etc.).
The combination of TV and computer is pretty natural. As a system, I don’t have any problems with it. If you don’t know much about PCs, it might be hard to set up and grasp the underlying ideas, but if it is set up then they can basically treat it exactly like a smart TV and just use the remote to surf through tv, pictures, radio, shopping, etc. (i.e., you never need to quit to the desktop and realize that it’s all being run on a computer) The situation that Mangetrout can happen: all you need is a decently powerful TV and an extender per monitor/PC. We have both cable and broadband (over which the digital telephone line runs as well as the net connection): those are the two “content” ins for the system.
I can also see the obvious and easy integration of live TV with web content actually becoming a reality here, though that has as much to do with the cable signal as it does with the media center.
All and all, it’s not a crazy idea. I don’t think it’s quite to the point where it’s a compelling need or combination, but it certainly is a step-up in terms of what you can do (the DVR and a computer are very obvious thing to combine).
Interestingly, the format that it records TV in seems to be totally unprotected, at least in our version. You can record TV and then send the file to anyone: it’s just uncompressed AVI (you can set the quality). Since the underlying architecture is just “files on your computer” you can even dump illegal video content (like my Aqua Teen Hunger Force Divx videos) into the media center video folder and watch them as long as the right codecs are installed. The media center doesn’t care, because it’s basically just a souped up windows media player that pretends it’s a CableTv interface menu.
The only real problem is that now they’ve apparently invented the first TV that can freeze up and crash without warning. it doesn’t happen often, but ANY time it happens is more often than a regular TV/cable service.