Networking the Customer

Only a few short years ago, home networking was heralded as an inevitability, with manufacturers and research groups rushing to establish standards and technologies for new, connected products. But as the battle for the living room heats up, a recent study suggests that more than half of tech-savvy consumers in the US are currently indifferent to the benefits that a networked home might offer.

The study, conducted by Accenture, has found that rather than connecting all the groups of devices throughout their homes, consumers are much more interested in the immediately realizable benefits of stand-alone devices, as well as "greater interoperability between devices that perform related functions," especially in the home entertainment and home office areas.

The study defines the networked home, once a favorite topic for futurists, who expected an avalanche of demand for network products, as a series of devices including PC, TV, and audio/video equipment, with related services such as Internet access or cable service, all in the home, that are linked together through a common network, either wired or wireless, and seamlessly interact with each other. Accenture reports that, in fact, customer readiness lags behind the technology. The study reveals that 57% surveyed say they don't have and don't want a wired home network and 66% say they don't have and don't want a wireless home network.

Accenture says a contributing factor in consumers' indifference to networking is that most (60%) make home electronics purchasing decisions based on the best current value for their money. In other words, they are willing to pay for benefits they can enjoy immediately. They appear less willing to pay for the value that a device may offer in the future.

The study found that consumers' reluctance to adopt networking technology is also related to their dissatisfaction with current costs. Of those questioned, 88% say they are dissatisfied with satellite and cable costs, 62% are displeased with PC costs, 54% are unhappy with game console costs, and 49% are discontented with TV costs.

Accenture's David B. Rich said, "The real market opportunity over the next couple of years is to help consumers connect easily within groups of devices, before connecting across groups and throughout the home. The future is bright for consumer adoption of the networked home, but more work needs to be done around defining the total customer ownership experience.

"Our study suggests that companies must focus on increasing consumer value and enhancing interoperability among devices. Specifically, companies should focus on creating new applications within device clusters that address consumers' core values of lifestyle fit, ease of use, performance and functionality, and low cost."

Despite the resistance to networking, the consumer electronics market should remain healthy: More than half (57%) the consumers surveyed say they expect the introduction of many new electronic products they will want in the next two years, and 88% say it is important for new devices to connect easily with their existing home electronics.