Bringing it all back home: the next broadband frontier is the home, thanks to the rise of the high-speed Internet and the growing popularity of Wi-Fi. Most of the hardware to make it happen is already here, and home networking is seen by many analysts as the next step up the broadband value chain

Telecom Asia, Nov, 2004 by John C. Tanner

Value added broadband

Even as standards are being sorted, however, broadband service providers are already seeing a big opportunity in home networking as a centrally managed offering to their customers, says Jonathan Gaw, research manager for IDC's consumer markets: home networking program.

"Home networking will reach its full potential as incumbent services and systems incorporate connectedness into their existing offerings," he says.

Not that service providers have been easy to convince. Apart from some early home networking services on offer in North America, most broadband operators have been sitting on the sidelines, says Yankee Group analyst Carrie MacGillivray.

"Until recently service providers have been reluctant to offer home networking solutions due to concerns about customer and technical service," she says.

However, she adds, the business case for home network offerings is compelling--it allows service providers to improve customer loyalty and satisfaction (and reduce churn), adds considerable value to the basic broadband connection as other devices go online and can encourage usage of premium-priced entertainment services.

Also, MacGillivray notes, as home networking functionality grows, home networks will become central to household life.

"Service providers must ensure they are at the foundation of this trend, or risk ceding the market to specialists, retail outlets, and hardware and software vendors," she says. "Consumers will be further tied to a service provider if they are linked to the home networking solution."

Gaw of IDC agrees that home networking will eventually be something users take for granted.

"In the long run, the majority of households with home networks may not even consider themselves a home network household," he says. "Rather, they will use connected devices as a matter of course, a natural evolution."

RELATED ARTICLE: The home network defined.

Not all home networks are created equally. Which is to say, there's more than one reason to network a home. For some, a home network is simply connecting two or more PCs and related peripherals like printers and scanners. For others, it's that plus VoIP. For others still, it's all that plus audio/video streaming from a PC to a home entertainment system.

It depends on who you ask.

David Grubb, Motorola's VP of business development for the consumer/enterprise solutions division, says that consumers are generally interested in four key "experience platforms:" enhanced communications (VoIP, video telephony, messaging), home or family monitoring (home automation), premium content management (as in entertainment content), and personal content management (same but with content you own, like camera-phone pictures).

"In general, we're getting a lot of resonance from users with the idea of connecting to the home while they're away, particularly with a cellphone," Grubb says. "Consumers in the focus groups we've worked with ask for this."

Louis Burns, vice president and general manager of Intel's desktop platforms group, put more emphasis on entertainment content as the chief attraction of home networking during a keynote speech at CEATEC Japan last month.