Home networks still intimidate

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by Tom Mainelli

(IDG) -- The technology is getting better, the price is dropping, and they're getting easier to manage, but home networks are still too intimidating, declares one analyst.

"The people that have [home] networks today are still the technically savvy," says Karuna Uppal, program manager of the consumer Market Convergence group at the Yankee Group .

Today only about 4 percent of PC households in the United States have a network. That's about 2.5 million homes, Uppal said in her presentation at the Networked Home Symposium here Monday. To reach everybody else, vendors must educate consumers on the value of home networking, including easy printer sharing, bonus phone lines, and linking several PCs to a single high-speed Internet connection.

The home network needs to do more than simply work. It should be easy to set up and perform with very little effort from its users, she said. "This is critical if it is ever going to make it to the mass market."

Share That Fat Pipe

The proliferation of broadband Internet connections is the major driving force behind home networking, Uppal said. Demand for Digital Subscriber Lines and high-speed cable access is far outpacing supply. Today about 3.8 million U.S. households have broadband access, and as many as 7 million would pay $40 a month for broadband if they could get it, she said. The Yankee Group expects broadband subscribers could reach 18 million by 2004.

And once consumers have that fat pipe coming into their house, they'll want to share it with their other PCs and other devices, she said. This paves the way for Internet appliances and Net-connected game consoles and MP3 players.

Consumers interested in home networking can choose from a growing number of technologies, Uppal said. With home phone line networks, wireless products, power-line units to choose from, the decision becomes confusing. To compound their concern, the different methods don't all work together, she said.

No Clear Winner

Still, most consumers don't care about the type of technology, as long as it works.

"There is no clear winner" in regard to the most popular technology, she said. "So they'll all have to coexist." Vendors need to clearly label the type of networking technology their product uses so consumers will learn what works together and what does not, she said.

Vendors have time to polish their products, she added. Despite its enthusiastic adoption, home networking won't be widespread overnight.

"It's a wait-and-see attitude," she said. Yankee research shows only about 5 percent of households with PCs plan to purchase a home networking kit in the immediate future. Including that group, about 25 percent of respondents plan to buy within a year; and about 33 percent plan to buy within two years, she said.

About 39 percent of those prefer buy that home network from their PC manufacturer, Uppal said. Phone companies, networking companies, and consumer electronic stores also score around 30 percent. Cable television companies score lower because "they don't have a great track record of customer service and support."

What's the best way to win consumers to home networking? Show them how it works, said Uppal. "There's nothing like seeing a demo to help consumers understand."

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