Instilling understanding
The best education is cool applications that create consumer demand.
Mike Wolf, Cahners In-Stat

The first announcement, about the recent formation of a group called the Internet Home Alliance (IHA), came out with a sizeable degree of press coverage and perhaps a more sizeable amount of head scratching. The other, residential-gateway software manufacturer DoBox's announcement about its partnership with ah-ha.com to provide Web filtering and privacy functionality to its offering, made a somewhat smaller blip on the radar.

First, let's look at the big announcement. The Internet Home Alliance, announced in October, is a group of widely different companies whose stated goal is to educate and promote understanding of home connectivity. Members include the usual suspects (Cisco, Sun, 3Com), as well as some unexpected names (Best Buy, Reliant Energy, General Motors).

Sprinkled with such Cisco-isms as "Internet-Lifestyle" and (ugh) "development of the entire ecosystem," the announcement wasn't a shock to Cahners In-Stat Group, which has called for public education and cooperation among links in this value chain as absolute necessities to get this market moving. Still, the announcement was a curiosity for those who were left confused over the Alliance's mission.

The reason for this is that the Alliance itself seems partly unsure about its ultimate reason for being. Educating end users about the value of something as vague as the "Internet Lifestyle" doesn't exactly reach Al Gore levels of specificity (I'll skip the requisite Internet invention jokes here). No doubt the goal is admirable, but it needs clarification. That said, the $3 million or so each founding member plunked down to get dealt into the game should translate into a sizeable marketing campaign.

The agreement between Do-Box and ah-ha, while smaller in scale and intention, is important because it is a sign of a change in thinking regarding home networking and connectivity. When Cahners In-Stat Group became the first research firm to forecast home-connectivity-based services early this year, it did so based on the idea that residential gateways would eventually enable the delivery of services to and around the home. Do-Box, which is creating part of a platform for service delivery and user control, is firmly aware of this. Others, such as GateSpace and similar OSGi (Open Services Gateway Initiative) solution vendors, are humming the same tune.

Shipments of first-generation home-networking products have not met expectations. This is due to the lack of compelling home-networking applications beyond broadband sharing, as well as a lack of easy-to-install and easy-to-use gateways. This is changing on both fronts, with basic gateways arriving soon and service-based home connectivity on the minds of most. Education, the other key element, now has IHA. However, our belief is that the best education is cool applications that create consumer demand.

Author information

Mike Wolf is a Senior Analyst at Cahners In-Stat.