Monday, December 04, 2000

Home Networking Gaining Mass Acceptance

A growing retail presence among companies manufacturing end-user home networking products indicates that the home networking industry is beginning to make headway in the mass market.

The effect is already visible on retail shelves, according to Parks Associates.  The Dallas-based technology market research firm says 35 percent of home networking components are shipping through brick-and-mortar retail channels, and initiatives such as the Internet Home Alliance will only strengthen the budding relationship between home networking manufacturers and retail outlets.  "As more products enabling enhanced connectivity and Internet services begin to roll out, the activity in the retail space will increase accordingly," says Nikki Robison, a home networks analyst for Parks Associates.  "Already, we are seeing plans for interactive kiosks and in-store product demonstrations to display the benefits of a connected lifestyle."

The Internet has introduced streaming and downloadable audio and video, altering both the delivery and format of entertainment, says Tricia Parks, president of Parks Associates.  "Consumers, as they start to understand the sheer breadth of their choices, do not want to be confined to one room or one TV set," she says.  "These consumers are starting to anticipate future solutions and advanced entertainment options with a growing amount of optimism."

The effort to devise open standards and specifications, although incomplete, is benefiting manufacturers developing products for retail sale.  Beyond coexistence, standards grant added benefits, including backward compatibility, interoperability, ease of installation, and ease of use, all of which allow for cheaper production costs.  As a result, home networking manufacturers are gaining more resources for marketing efforts and consumer education, along with the ability to influence purchase decisions at the retail level.  "Retailers and manufacturers will make great strides in leveraging what is otherwise expensive shelf space inside a retail location to demonstrate the benefits of these products to the consumer," says Robison.

From the article "Home Networking Gaining Mass Acceptance," by John Edwards

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