Entertainment Drives Home Technology

N E W  Y O R K, Oct. 17, 2002 -- Ask anyone who's going through the process of building a first home network and they'll probably tell you they're doing it because of their job or to help the kids with their homework.

But let's face it, the only thing that will really sell consumers on the idea of stringing category-five Ethernet cable around their baseboards is better entertainment.

As of June, some 6.3 million American homes have already gone to the trouble of building a home network, according to Scottsdale, Ariz.-based research firm InStat/MDR.

And another research outfit, Parks Associates of Dallas, says that next year one-third of all new homes built in the U.S. will contain some kind of structured wiring built into the infrastructure of the house suitable for networking.

Entertainment is the third-most cited reason that homeowners want it, behind computer networking and home security.

New homeowners want the expensive stereo systems they have assembled so conscientiously for optimal sound in the living room to reach other rooms of the house and even the back yard.

"We're doing a lot of audio systems these days," says Louis Calone, who installs home networks on Long Island, N.Y.

Multiplex in the Living Room

Broader concepts of a home entertainment network are still struggling to emerge.

The most interesting ones involve distributing video to multiple screens.

The device that had the biggest buzz at the International Consumer Electronics Show in Las Vegas last January was the Moxi Media Center, the newest gadget from WebTV founder Steve Perlman.

The plan was to sell a TV set top to cable operators with a hard drive for recording TV programming (think TiVo) and with support for both hard-wired and wireless networking to send that programming to screens all over the house.

The box is still around, though the company isn't. At the end of March it merged with a Seattle-based outfit called iTV to become a company called Digeo. It has backing from Paul Allen's Vulcan Ventures, AOL Time Warner, Cisco Systems and The Washington Post Company, among others.

In July, Scientific Atlanta, the maker of cable TV set top boxes, said it would build a box around the Moxi technology that will be available to some of the 6.8 million Charter Communications cable subscribers sometime in 2003.

Thinking Outside The Office

Meanwhile, the personal computer camp is leading its latest in a long string of failed attacks to push the computer out of the home office and into the living room.

Microsoft and Hewlett-Packard teamed up on an entertainment-oriented computer called the Media Center PC that is designed to act like a TV and digital music jukebox, complete with remote control.

The PC can also record programs a la TiVo or ReplayTV from SonicBlue.

Right now the Media Center PC is designed for use in a single room, but networking analyst Mike Wolf with InStat/MDR says a version of the same machine is in development that will act as the central repository for entertainment in a networked home.

Are Consumers Interested?

Despite these new products, the market remains elusive.

"I'm a strong believer in the entertainment network for the home," Wolf says. "But right now if you have a home network, chances are it's data only."

And wireless entertainment networking is even rarer. Wi-Fi has generated a lot of headlines, but the vast majority are built on Ethernet — less than a third are wireless.

A small remainder use technologies like home phone lines and power lines.

Don't expect that to change anytime soon, Wolf says, because when it comes to video, wire is king. "Wireless is great for data, but when you're doing video you need the consistent speed that a wire can deliver."

But if consumers won't warm up to tricked-out set top boxes or PCs, they may already have a little network-ready Trojan horse, courtesy of their favorite video game company.

Sony just launched a network attachment for the 11 million Playstation 2 boxes it has sold in North America, while Microsoft built its XBox with networking in mind — supplying an Ethernet port from the start.

Uptake is expected to be slow at first, but as with so many other advances in consumer technology, the gamers often lead the way.

For more, go to Forbes.com..