Parks Associates started following the development of residential gateways in 1995. Since that time, the residential gateway has evolved beyond its initial conceptual stage. However, many strategic issues have yet to be addressed, including gateway definitions, technical standards, physical formats, functionality, modularity, price points, service aggregation, etc., in order to ensure a robust market for gateway products. In addition, there is little evidence that the development of residential gateways is consumer-driven. So questions naturally arise: how can manufacturers/service providers sell gateways to consumers? What benefits do consumers want to get out of gateways? And what types of gateways will appeal most to consumers?

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Parks Associates started following the development of residential gateways in 1995.   Since that time, the residential gateway has evolved beyond its initial conceptual stage.  Companies from multiple industries are positioning themselves as early entrants into the gateway market, and there have been both numerous gateway product announcements and limited commercial deployments.  However, many strategic issues have yet to be addressed, including gateway definitions, technical standards, physical formats, functionality, modularity, price points, service aggregation, etc., in order to ensure a robust market for gateway products.  In addition, there is little evidence that the development of residential gateways is consumer-driven.  So questions naturally arise:  how can manufacturers/service providers sell gateways to consumers?   What benefits do consumers want to get out of gateways?  And what types of gateways will appeal most to consumers?

Figure 1

To help gateway manufacturers and service providers address these issues/questions, Parks Associates is launching a landmark multiclient study:  Bundled Services and Residential Gateways. This study will have two components:  a Delphi (qualitative) survey of key industry players and a quantitative consumer survey.

For the purpose of this study, Parks Associates narrows down the definition of a residential gateway to "a device that terminates one or more external network(s), provides and enhances access to the Internet, and distributes service(s) via an in-home network."  Because different industries have different interpretations of the term "residential gateway," the working definition above is needed to avoid confusion and establish the key parameters of the study.

Residential gateway players fall under three groups:  gateway manufacturers, component suppliers, and service providers.  The market for residential gateways will never materialize if there are no gateway products available. At the same time, service providers play a critical role in defining market needs.  To assess the direction of residential gateway, it is critical to understand gateway manufacturers’ and service providers’ roadmap for the future as well as their current business models.

Parks Associates possesses in-depth, cross-industry knowledge of all the key players in the residential marketplace and has the requisite experience to conduct executive surveys.   Armed with the knowledge to identify both the key players in each industry and the challenges that face gateway players, Parks Associates will design a detailed questionnaire and mail it to the appropriate executives in charge of developing/deploying gateways and advanced services for the companies listed in Figure 2.  Parks Associates may also need to conduct telephone interviews with company executives in order to ensure timely completion of the survey.  In total, Parks Associates will survey at least 50 key gateway players, and results from the survey will be compiled in a written report without disclosing the names of the specific service providers.

Figure 2

Consumers will not be queried about "gateways" per se but rather the issues and major applications related to residential gateways.  Parks Associates proposes to conduct a national telephone survey of 2,000 households through random digit dialing.  The specific topics of the survey are illustrated in Figure 3.  This list of topics is preliminary, and sponsors can review and provide input into the final survey.

Although part of the working definition of residential gateways is that they must provide an Internet connection, Parks Associates believes that it is necessary to determine the nationwide penetration rates of electronic products and services at home (not just among online users).  These products and services are related to gateway-enabled applications in one way or another.  In addition, a nationwide telephone survey provides comprehensive, statistically projectable data on individual consumer segments.

The survey is scheduled to go to the field in January 2001.  (See Figure 5 for proposed timeline.)  By that time, Parks Associates expects the penetration rate of residential Internet service to be above 50%.  Thus, the total sample will include more than 1,000 online users, which should provide a solid sample size of the target population for residential gateway products.

Parks Associates has worked with numerous call houses in the past and is very familiar with all the steps in conducting primary research.  Parks Associates will select a reputable call house to field the survey and will perform data analysis in house.   Parks Associates has both the quantitative skills and industry expertise to draw meaningful conclusions from the survey.

Figure 3

Figure 4

For more information, please contact Parks Associates at sales@parksassociates.com or at 972-490-1113.

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