If you're looking for something that sounds better than a sound bar, you'll want to put together your own system with an AV receiver and surround-sound speakers.
Choosing an AV receiver doesn't have to be a difficult affair, even though they're complex devices. This year the standout option is the Sony STR-DN840. It has standard AV receiver features such as 7.1 channels and six HDMI inputs, but it's also packed with wireless connectivity, including built-in Wi-Fi, Bluetooth, and AirPlay. If you don't need all the extra features and are looking for a more stylish option, Marantz's slimline NR1403 is also worth considering.
Speakers, like sound bars, come down to sound quality and design, and it's generally a trade-off between those two factors. Small, stylish speakers like the Boston Acoustics SoundWare XS 5.1 look great and won't intrude on your living room, but they're not a top pick for sound quality. On the other hand,
Home audio can get a reputation for being excessively expensive -- it's not uncommon for a pair of speakers to cost $2,000 or more -- but I've deliberately picked products that prove you can get great performance on a modest budget. The Sony STR-DN840 ($375) and Energy Take Classic 5.1 ($400) speakers cost $775 total, which isn't cheap, but I wouldn't be surprised if the combination lasts you a decade.
3. Alternative: Don't be afraid to go stereo
The standard home audio setup used to involve two tower speakers and a receiver, but for some reason that's less frequently considered an option these days. That's too bad, since a solid two-channel system, plus a subwoofer, can be surprisingly effective with movies and music, even without the immersive elements of surround sound. (Video games benefit more from true surround sound, in my opinion.)
The benefits are a simpler system that often sounds better than a more elaborate one. You don't have to worry about running wires to the back of your living room or positioning a center channel speaker, but you'll still get much better sound on music and movies than with a sound bar. And because you're only buying two speakers instead of five, you'll have two killer front speakers, rather than five average ones. Pioneer's SP-FS52 tower speakers ($125 per speaker) are an inexpensive place to start.
Another benefit to going stereo is you can opt for a compact integrated amplifier, rather than a full-sized AV receiver. Again, if you use your TV as a switcher, an excellent amp like the NAD D 3020 can easily act as the hub of your living room despite its small size.
What about home theater in a box (HTIB) systems?
HTIBs used to be the go-to budget option for home audio, but I'm reluctant to recommend an HTIB these days. You get all the downsides of multiple speakers and tangles of wires, but you don't often get dramatically better sound than with a good sound bar. And unlike AV receivers and speakers, an HTIB typically isn't upgradable, so you're stuck with the AV receiver, speakers, and built-in Blu-ray player your HTIB features.
While there are some scenarios in which an HTIB is the best option, in most cases you're better off saving up for a full-size system or settling for a good-enough sound bar.
General rule: Spend most of your budget on speakers
Most people have a limited budget to spend on their home audio system, so the question is: How am I going to get the biggest bang for my buck? The answer, unequivocally, is speakers.
While you may be tempted to purchase a beefed-up $2,000 receiver with fancy-sounding internal components, I'm skeptical they're worth the money. There's not much evidence that the differences between amplifiers are audible in double-blind tests, so at worst you're paying extra for the placebo effect, and at best you're paying for something that's very difficult to notice, even by experts in ideal situations. A budget AV receiver with great speakers will deliver a much bigger bang for your buck -- and you can always upgrade the receiver later if you can't shake the nagging feeling that it's holding back your system.
Whatever you do, don't spend extra on cables. There's no difference between a $5 HDMI cable and a $500 HDMI cable. And the same can nearly be said for speaker cables, as long as you make sure you're using an appropriate gauge for the length of your cable run (guidelines here). Head to Monoprice or Amazon, get a cheap cable, and never think twice about it.
FAQ
Is 7.1 worth it?
Not in my opinion. It's a classic case of diminishing returns: 5.1 sounds a good deal more immersive than stereo, but the difference between 5.1 and 7.1 isn't nearly as great. Not to mention the fact that there just isn't that much content with true, discrete 7.1 channel soundtracks.
Do I need an AV receiver with built-in AirPlay?
The simple answer is probably not, but I've covered this issue with its own in-depth story if you're interested in the details. While some will be better off buying a separate Apple TV, it's less of a dilemma now that there are inexpensive receivers with built-in AirPlay, like the Sony STR-DN840.
Does virtual surround really work?
Many sound bars claim they can create a surround-sound experience without the need for rear speakers, but in the vast majority of cases that's not true. That's not to say the virtual surround modes are worthless -- they often do a decent job of widening the soundstage -- but they'll rarely make you feel like the sound is coming from the sides or behind you. The exception is Yamaha's pricey line of YSP Digital Sound Projectors, which can actually do a convincing job of virtual surround sound from a sound bar.
Will a sound bar block the remote sensor on my TV?
This can be an issue, which is one of the reasons I like sound bars with a pedestal design, like Zvox, Bose, and SpeakerCraft offer. It all depends on where your TV's remote sensor is, the dimensions of the sound bar itself, and how you position it. Some sound bars, such as Sony's HT-CT260, also feature an IR repeater, which passes on your remote signals using a blaster in the back, so it still reaches your TV.