News

Demand for Wireless Solutions Gives Home Networking a Boost, But Inroads to the Living Room Remain Elusive, IDC Says (1/4/2004)

Sparked by growing demand for wireless solutions, IDC expects the number of U.S. home networks will climb from 12.5 million in 2003 to 16.2 million in 2004. Despite this impressive growth and the maturation of data home networks, media and entertainment home networks continue to lag.

"The advent of more reliable wireless equipment, combined with aggressive pricing of 802.11b devices, made for a blockbuster fourth quarter for almost all vendors," said IDC Research Manager Jonathan Gaw. This trend will continue, but ease of use in installing and maintaining wireless home networks will be critical, especially when expanding the market for media and entertainment networks. "Although an early adopter market for multimedia home networking has developed among the most avid gamers, audiophiles, and home theater enthusiasts, to further penetrate these markets vendors will require an even greater emphasis on ease of use as they reach out to those who may not have a strong background in computing."

Going forward, there is tremendous opportunity in the home networking space, but vendors must remain diligent by staying on top of evolving technologies, developing new features, and delivering services at a compelling price. Although home networking currently plays the humble role of allowing consumers to share their broadband connections, files, and printers, home networking will eventually provide the underlying infrastructure of the long-promised digital home.

Key Findings

-- Sharing a broadband connection continues to be the primary use of home networking

-- By 2008, 30 million US households will have either a data-centric or a media-centric home network

-- Home networking is the springboard to a digitally connected home

-- Evolving wireless networking standards have paved the way for video and media streaming over home networks

-- Data home networking will reach 27.5 million households by 2008, with 24.6 million of those using wireless technologies

-- Lower prices will help 802.11b clients out-ship 802.11g in 2004, but revenues from 802.11g in home networking will far outpace those from 802.11b

IDC's study, U.S. Home Networking 2004-2008 Forecast (IDC #30932), examines the evolving U.S. home networking market as it expands from a data-centric activity to an entertainment and multimedia endeavor. In the long run, home networking will provide the infrastructure used by a variety of entertainment, productivity, and home management systems. This study examines the current condition of the home networking market, which primarily focuses on data transmissions, and lays out the road map for the broader home networking vision.

www.idc.com