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| EMagazine Volume 4 Issue 4 August 1999 |
Features
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Home Networking Facts &
Fiction This document examines common misconceptions regarding the home networking market and identifies desirable attributes that consumers will look for in a home networking solution. Many of the insights shared here have been derived from primary consumer research commissioned from The Angus Reid Group and secondary consumer research from Forrester's Technographics service. This Facts & Fiction, #2 in an occasional series, is an abridged version of more extensive information presented on ShareWave's Web site at http://www.sharewave.com . |
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Many market factors are aligning to drive the rapid adoption of home networking solutions. Isolated "islands of technology" are becoming connected, providing consumers with more places in the home to enjoy the increasing amount of rich digital content. Soon, many new classes of both PC and non-PC devices combined with connecting technologies will enable consumers to access the content and applications they want, where and when they want them.
This document examines common misconceptions regarding the home networking market and identifies desirable attributes that consumers will look for in a home networking solution. Many of the insights shared here have been derived from primary consumer research commissioned from The Angus Reid Group and secondary consumer research from Forrester's Technographics service. This Facts & Fiction, #2 in an occasional series, is an abridged version of more extensive information presented on ShareWave's Web site at http://www.sharewave.com .
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Fact: Consumers are eagerly embracing multimedia applications. The prevalent use of multimedia content on standalone devices today dictates that home networking connections must also support multimedia. Early adopters of DVD players, DBS systems, and broadband Internet access want to easily share multimedia content among their digital devices. As the penetration rate of these advanced devices continues to escalate, the mass technology market will also realize the appeal of sharing multimedia content.
ShareWave/Angus Reid primary research, 1999, 86% of Technology Optimists were interested in a Multimedia Furnace concept, and 66% of Technology Optimists place importance on the ability to share multimedia/video programs. Owners of DVD players, DBS systems, and broadband Internet access rate sharing multimedia content even higher as an important home networking feature. · There will be tremendous growth in digital content and services:
- Broadband and Streaming media
Broadband connections will deliver multimedia-rich services, including voice, audio and video in addition to data. According to Cahners In-Stat, broadband Internet access is forecast to be installed in 45 million US homes by 2002. · RealNetworks has distributed more than 65 million copies of its RealPlayer Internet system for sending and playing ''streaming'' audio and video. · The number of U.S. radio stations broadcasting online jumped to 1,020 from just 500 in the last half of 1998. Broadcast.com reported in early 1999 that more than 2,000 radio and TV stations worldwide are online. - Stored digital audio and video
By 2004, 14 million TV viewers will be using personal video recorders (such as TiVO and Replay Networks) according to Forrester Research. Forrester predicts that digital music downloads will become a $1.1 billion business by the year 2003. The average MP3 collection contains 100 MP3 files which requires a minimum of 400 MB of HD space. The market for PC-connected digital and videoconferencing cameras will grow to be a $1 billion business within five years according to Cahners In-Stat. - Communications
Forrester believes that the voice over IP (VoIP) market will take away about $3 billion from U.S. phone companies by 2004. · Newsweek said that more than 16 million people around the world use the Internet as their long-distance carrier. · Killen & Associates project that 18 percent of the Fortune 1000 voice traffic will travel over IP by 2002. ·
Read more about this subject at: http://www.sharewave.com/Home_Net/Consumer_R equirements/consumer_requirements.html
Fiction #2 - Consumers do not care about high performance in today's home networking solutions.
Fact: Technology consumers are very demanding. They harbor a list of performance requirements in any new technology they consider adopting. Consumers will not take a step backward in performance in order to network their devices. In fact, it will take high performance solutions to drive adoption of home networking among mainstream technology users.
ShareWave consumer research shows that:
- With any new technology today, consumers expect high speed performance and top image and sound quality.
- High performance networks are required to:
- support multimedia content,
- scale to support additional networked devices with minimal degradation to network performance,
- preserve broadband service quality, and
- efficiently handle today's evolving data needs as files become larger.
- Home technology users have a significantly greater interest in high performance home networking solutions than low speed office LAN type solutions, and this will drive the market.
Read more at: http://www.sharewave.com/Home_Net/Performance/performance.html , including a consumer defined checklist of performance requirements.
Fiction #3 - Raw data rates are an accurate measure of realizable home network performance.
Fact: Raw throughput numbers do not tell the whole story. Network utilization or efficiency has a dramatic impact on the actual realized speed across a network connection. For example, Ethernet network connections typically achieve 30-50% utilization of the network link.
A recent Forbes article cited test results of one manufacturer's wireless home networking solution that claimed 1.6 Mbps, but only delivered 450 Kbps, a fraction of the performance! A 1 Mbps connection only achieved a throughput of 350 Kbps. Thus, effective throughput is a very important criteria when evaluating the alternative types of home networking solutions (wired and wireless).
ShareWave's technology, based on the WhitecapTM network protocol, delivers a higher utilization, up to 75%. Whitecap is a QoS-enabled, isochronous protocol that provides high-performance, high-quality, and secure communicatio ns of real-time multimedia content across network connections.
For more details go to: http://www.sharewave.com/Home_Net/Performance/perform ance.html
Fiction #4 - Wireless is a niche solution only suitable for mobile devices.
Fact: Most households with a home network will employ a variety of physical connections, both wired and wireless. Thus, wireless will be a key component of any home networking solution.
- Wireless offers ease of installation (i.e. no invasive, expensive wiring; no installation of new jacks) and portability when families move to another residence.
- Wireless enables complete flexibility of location for networked devices (i.e. users are not limited by availability of phone jacks or AC power outlets). As the world becomes less PC-centric, phones jacks will be in fewer locations where consumers want to locate non-PC devices, such as home entertainment systems.
- Wireless provides the unique ability to support mobile devices (e.g., notebooks, handheld pads, PDAs, cordless Internet phones, etc.).
- Wireless faces fewer obstacles to international adoption. The quality and capability of other "no new" wires technologies like phoneline and powerline varies significantly throughout the world, as does the number of phone and electrical outlets per household. Significant international volume will also drive wireless costs down rapidly.
For more details, go to: http://www.sharewave.com/Home_Net/Consumer_Requireme nts/consumer_requirements.html And http://www.sharewave.com/Home_Net/Approaches/approaches.html
Fiction #5 - Home networking is just for connecting multiple PCs.
Fact: There is tremendous interest in high performance networking of numerous types of digital devices, both PCs and non-PCs. Thus, the market for home networking solutions extends beyond multi-PC households to include single-PC households and even non-PC households. Analyst' projections that home networking will become a multi-billion dollar business by 2002 only account for networking PCs in multi-PC homes. Servicing the demand in single PC homes increases the potential market dramatically, to over 50 million US households by the end of the year 2000 (forecasted by analyzing Forrester Research's Technographics database of approximately 100,000 North American homes). Including non-PC homes in this forecast increases the potential market even higher.
- The appeal of high performance, wireless, multimedia-capable home networking solutions is virtually universal; initial early adopters of home networking will be online high income (>$50k) Technology Optimist households, followed by online high income Technology Pessimist households and online lower income (<$50k) Technology Optimist households.
- High performance networkable consumer products will start becoming available early next year and will include broadband modem extensions, residential gateways, TV terminals, mobile pads, VoIP phones, and connections for PCs and laptops.
- Non-PC homes with other digital technology such as DBS satellite TV, DVD players, and digital cameras will be able to begin networking devices as well.
- Parks Associates forecasts the total market value of Emerging/Digital Home Entertainment Networks to be $3.3 Billion by 2004, compared to Home PC networks valued at $2.3 billion.
For more details, go to: http://www.sharewave.com/Home_Net/Industry_Evolution/industry_evolution.html And http://www.sharewave.com/Home_Net/Target_Consumer/target_consumer.html
Check out ShareWave's new Home Networking Resource Library, which includes a glossary, an aggregation of links to analyst reports on home networking, lists of industry events and organizations, and recent media coverage of the home networking industry: http://www.sharewave.com/Home_Net/Resources/resources.html
