Opening Keynote: Any Device, Any Time in the Digital Home

Louis J. Burns, VP and Co-General Manager, Desktop Platforms Group, Intel
Kevin Corbett, Director, Marketing & Strategic Planning, Desktop Platforms Group, Intel

“All ways Digital – All ways Connected – and Always on”

Louis Burns and Kevin Corbett of Intel presentation stressed two megatrends:

• All devices and content are going Digital;
• People want easy access to their Digital Shoebox (of photos, videos, and music). To accelerate these megatrends, Intel is working with standards bodies and building a home networking framework of hardware reference platforms and development tools.

Intel believes that much of home networking will be wireless, mirroring the viewpoint of CE manufacturers making or planning products with integrated wireless capabilities, including products such as networked DVD players and TVs. Intel’s demonstration at CONNECTIONS™ featured 802.l1b and a new Linksys Digital Media Adapter that links CE and PC devices. The demo incorporated a 3-D photo album with animated transitions and music that exploited a 3 GHz PC, as well as Internet music and broadcast television with the PC providing DVR capabilities. Music and TV programs were streamed from a desktop PC to TVs and stereos with impressive sound and picture quality. The scenario envisions a handheld RF remote for consumer control with menu-based options on a TV display.

Louis Burns asked the question, “What’s next from Intel’s view?” And answered that question with one word: mobility. The Intel demonstration moved on video streaming to a notebook PC and a Philips iPronto tablet.

The summary for all of this is that from Intel’s view, these are huge categorical opportunities and that Intel will be in the forefront, helping companies as it goes by providing solid building tools…and chipsets.

Morning Keynote: Unlocking the Potential of the Digital Home

Kevin Eagan, General Manager, Windows eHome Division, Microsoft Corp.

Kevin Eagan’s presentation and demo featured three Microsoft platforms: Media Center PC, Tablet PC, and Smart Display. Kevin began by plugging in and turning on a next-generation TV with built-in wireless networking. The UPnP equipped TV automatically discovered the home network, went through an authentication schemed, then displayed a TV-optimized home page with menu categories like Favorites, Recent Media, Home Controls, Family Calendar, What’s Happening, People, and more.

The Media Center PC, incorporating DVR capabilities, records and stores TV programs and also provides a personalized Interactive Program Guide that displays a list of standard- and high-definition programs from satellite, terrestrial broadcast, and hard disk. Kevin provided demonstrations of useful consumer applications. For example, when the phone rings, the TV displays Caller ID information, and when one TV is paused to take the call, others TVs continue with the program.

The Microsoft demonstration also featured a Windows Smart Display (wireless PC monitor), a Windows-powered Smart Phone (cell phone/PDA), and a Simple Remote Control (to manage various smart home devices). The demonstration Smart Display received wireless video and allowed its consumer to check on what other TVs were showing, thus providing some parentatl controls and check ups. Kevin also used the Smart Display to configure other home devices, add parental controls, and modify TV home pages and photo trains, as examples of possible desirable applications.

The Microsoft presentation and demo reinforces the two Megatrends as enumerated by Intel…and Microsoft’s intentions to serve and share in the dollars this marketplace will generate.

9:00 am – 10:15 am

The Promise of Digital in the Whole Home

Moderator: Tricia Parks, President, Parks Associates
Jens Jensen, Vice President, Marketing, Semiconductors, Consumer MultiMedia, Philips Semiconductors
Bruce Mehlman, Assistant Secretary for Technology Policy, U.S. Department of Commerce
Patrick Moorhead, Vice President, Customer Advocacy, AMD; Chairman, Global Consumer Advisory Board

The industry leaders in this session represented a governmental and consumer sensitive perspective to the digital wonders that are now emerging.

Jens Jensen of Philips suggests that homes of the future will look more like homes of the past than homes of today, and he showed examples of Philips research in Ambient Intelligence, where processors, sensors, and actuators are embedded into everyday objects. In other words, technology will be better, more powerful, and more pervasive, but less obviously visible. There seems an analogy to the gradual permeation of electricity into homes and even simple daily actions. For Philips, this normalization and, with skillful marketing and good products, even a perception of technology banality is a good and necessary market growth stage and condition. The more common and pervasive technology becomes in daily consumer lives, the more it is desired.

Pat Moorhead, Vice President Marketing and Chairman of AMD’s Global Consumer Advocacy Board (GCAB) pointed to the reality of consumers adopting “new” technology and upgrades more slowly than in the past even while new products and technologies come to market faster and in more volume than ever before. The space between what a consumer has and can get is called “The Technology Gap” by AMD. It disturbs Pat and he believes that it is a warning: address the causes of “The Technology Gap” or pay the consequences of non-optimal market speed and dollars. GCAB has identified five required consumer perceptions that are necessary to optimal technology acquisition…all over the world.: Simplicity of benefits and usage, Trust in the technology and service sectors promises; Systemic Alignment (ecosystem) or value chain alignment, Socio-Economics or adequate funds and education to afford product and realize benefits; and Relevance at a personal level of understanding.

GCAB is addressing this and AMD calls for a migration from a technology focus to a focus on actions and marketing to achieve the above consumer beliefs and conditions.

As Assistant Secretary of Technology for the US Commerce Department, Bruce Mehlman spends a solid amount of his time explaining the benefits of technology to individual Americans and to the nation’s global competitive position. What he often discovers is a lack of real understanding about technology products, even among Congress members. According to Bruce, “If you want to wire the home, you need to plug into Washington.” He spoke of President Bush’s technology agenda, the many policy challenges, what’s being done already, and the need for the home networking industry to settle on a set of clear messages to educate policy makers on important issues,. He believes that the diffusion of digital into a majority of US homes will be a contributing factor to the US maintaining leadership in the wealth of nations. Bruce discussed the potential for telework, healthcare service, energy efficiency products, learning-at-home to offer ever increasing consumer freedom. Bruce placed the B2C e-commerce market at $95B in 2003.

Bruce believes that the technology companies will benefit from clear messaging to and educating the policy makers in Washington.

10:35 am – 11:35 am

The Global Inventures Connected Circle: Building A Foundation for Success

Moderator: Deepak Kamlani, Founder, President, and CEO, Global Inventures Inc.
Moderator: Kurt Scherf, Vice President Research, Parks Associates
John Barr, Director, Standards Realization, Motorola, Inc., representing the OSGi™ Alliance
Bob Heile, Chair, IEEE 802.15 Working Group on Wireless Personal Area Networks, representing the ZigBee™ Alliance
Peter Kempf, Vice President of Business Development, Conexant Systems, representing the HomePlug® Powerline Alliance
Jim Meyer, Vice President of Business Development, Time Domain Corporation, representing the WiMedia™ Alliance
Stephen Whalley, Manager of Technology Marketing with the Desktop Architecture Lab, Intel, representing the UPnP™ Implementers Corporation

Global Inventures is now working with CEA to migrate standards efforts into real-world standards. Its teams have joined with five alliances to discuss and mitigate the challenges in making products work well in real environments and with other standards. To a person, the panelists agree that products must be easier to set up and maintain because problems affect initial sales and the volume of returns. In sum, these along with word of mouth about poor consumer experiences with integrated technologies stem industry growth. For the manufacturers, these issues combined with the raw expense of sending technicians into homes to fix mistakes of failed integrated systems are difficult to manage and simply too expensive over the long haul.

• The UPnP Forum promotes device discovery with a protocol that is agnostic to hardware, operating system, programming language, and media.
• The OSGi Alliance defines a service platform to embed in gateways, automobiles, and other products so that upgrades and system repurposing can occur remotely.
• Powerlines are ubiquitous and represent a grand approach to making networking cost effective and simple. For powerline networks, HomePlug 1.0 already supports up to 14 Mbps. HomePlug AV will support multistream video, including SDTV and HDTV.
• For 100+ Mbps of wireless throughput, the WiMedia Alliance is developing specs based on 802.15.3 and ultra-wideband (UWB) for use within a room.
• To solve the challenges of static networks with lots of wireless devices and small data packets, the ZigBee Alliance targets very low-cost products with extra-long battery life for home and building automation, PC peripherals, consumer electronics control, medical and security sensors, toys, and games, first appearing in late 2004.

11:35 am – 11:55 am

The Future is Integration: Service Delivery Platforms

John Marshall, Vice President of Marketing, 2Wire Inc.

John Marshall’s vision for home networking encompasses telephony and entertainment as well as traditional PC-to-PC connections. To fulfill this vision, 2Wire believes an integrated gateway with multiple capabilities is essential. Some key points of John Marshall’s presentation are below:

• The digital home is beginning to happen and modems are transitioning to gateways.
• Providing an integrated gateway that includes new features will be crucial in providing services via broadband.
• Such a gateway will place greater customer service obligations on service providers.

12:00 pm – 1:00 pm

Track A — Entertainment: Creating a Value Proposition for Connected Entertainment: The Role of Content

Moderator: Kurt Scherf, Vice President, Research, Parks Associates
Moderator: Allison Dollar, Co-President, Interactive Television Alliance
Ty Roberts, CTO, Gracenote
Steve Saunders, Project manager for Home Networking, Cable Labs
Chris Allen, SVP Strategic Planning, MUSICMATCH
Michael Collette, CEO, Ucentric Systems
Ed Forman, SVP Marketing, ICTV
Lee Friedman, Chief Services Architect, BellSouth Internet Group

In a standing-room-only session, this panel tackled multiple contentious issues around copyrighted content. Current industries issues discussed by this panel include the following:

• The fear of the Napster model for paid content;
• The need to strike a balance between Digital Rights Management (DRM) and consumer rights;
• Is DRM a “tempest in a tea pot” (Allison Dollar’s personal view) based on new business models on the horizon?
• What are consumers’ expectations for quality-of-service?
• How will consumers distribute digital content within the home?
• The need for well-designed content menu displays and easy-to-maneuver controls for the TV.

There are many opinions and viewpoints on these issues; however, there also exists some agreement. Panelists agree on the following points:

• Content is key – consumers want choice in viewing and listening to content
• DRM is a very contentious issue – protect existing business models vs. new business models such as advertainment.
• A better consumer user interface (display options and controls) is needed for the TV.

Track B — Wireless: Wireless Networks: From Here to Ubiquity?
Moderator: Yuanzhe (Michael) Cai, Analyst, Parks Associates
Shripati Acharya, Product Line Manager, Wireless Networking Business Unit, Cisco Systems Inc.
McGregor (Mac) Agan, Director of Wireless Industry Marketing, Wireless Networking Division, Intel Corp.
Pat Romano, VP of Engineering, 2Wire Inc.
Sheung Li, Product Line Manager, Atheros Inc.
Vivek Pathela, Director of Product Marketing, NETGEAR Inc.
Jim Zyren, Director of Marketing, Wireless Networking, Intersil Corp.

The panel agreed that wireless networks will become ubiquitous in the near future; however, there was heated debate over which technologies will dominate the marketplace and what requirements will shape the value chain. Some panelists maintain that Wi-Fi™ had the momentum to dominate completely, while others insist that additional technologies such as Bluetooth and WiMAX have a place as well. There was also sharp disagreement over the roles each Wi-Fi standard (A, B, and G) will play.

In another hiatus of agreement, panelists agree that consumers were not well educated about Wi-Fi, but consensus ends there. Panelists disagree over solutions to the challenge. Some proffer education as solution; others state that there must be easier to understand technology.

Regarding the value chain, many expressed skepticism that “free” Wi-Fi access will persist due to user needs for high quality service and reliability as well as the legal issues raised by “free” access. There was also general acknowledgement that the increasing competitiveness of the Wi-Fi equipment industry will drive prices (and margins) downward. Because Wi-Fi is a standard technology, companies are finding it difficult to differentiate from each other on the retail shelf.

While all agree that wireless will be ubiquitous in the future, it is also clear that…

• The role of the differing technologies and standards is not yet clear.
• Wireless networking is just becoming established and will mature over the next few years.

Track C — The Visionaries: The Vision: The Strategy for Value-added Services
Moderator: Michael Greeson, Vice President, Principal Analyst, Parks Associates
Peter Baldwin, CEO, Point Clark Networks
David Horoschak, Sr., Marketing & Business Development Manager, Motorola Inc.
Marc Morin, Co-founder and Chief Technology Officer, Sandvine Inc.
Craig Soderquist, President & CEO, Core Networks
Michael Stich, Director, Strategic Marketing, Texas Instruments
Ofer Vilenski, CEO, Jungo Software Technologies

This panel identified and discussed key issues for value-added services, including the following:

• When will we see profitable bundles?

When traditional voice, television, and data services are sold separately, they become low-cost commodities, but IP-based bundles are slow to market due to large capital requirements.

• What separates network operators and service providers?

Services like firewall, parental control, antivirus, and spam filtering often come for free with dial-up service providers such as AOL and MSN, so how do broadband network operators make money? Will consumers pay $40/mo for broadband access, another $20/mo for aggregated Web content (as with AOL), and even more for Internet music, music downloads, and movies-on-demand?

• Application Portal or Network Pipe?

Will we end up paying for application value (e.g., emergency alert from medical monitor or security system) or for bandwidth consumed (e.g., movie download or stream)? While one sends just 19 bytes, the other sends 4GB.

• What services will drive more revenue and broadband growth?

Answers include antivirus, parental control, home networking (as cable operator service), music and audio (once DRM issues are solved), interactive TV, and applications supporting the aging populations. These are all consistent with Parks Associates research.

1:00 pm – 2:30 pm

Luncheon Keynote: Real-time Digital Connectivity: The Coming Revolution in Home and Professional Digital Electronics

Henry Juszkiewicz, Chairman and CEO, Gibson Labs

Mr. Juszkiewicz repeatedly stressed that as a consumer, he “hates technology.” Consumers, he states, do not want and should not need to understand the mechanics behind consumer electronics. To highlight this fact, he pointed out the numerous means of interconnecting devices such as TVs/VCRs/ PCs/musical instruments/etc. By his count, 32 standard efforts are underway. Henry believes this morass of efforts needs streamlining. Instead of continuing participation in the quagmire of all these efforts, the consumer electronics, telecommunications, computing, and entertainment industries (as well as others) should join together and create a single interface standard that meets everyone’s needs. He then offered Gibson Labs’ new Magic technology and consortium as a vehicle through which this could be achieved.

• Technology should be simple, easy, and invisible to the consumer.
• A single standard is needed to connect all devices in order to make technology less visible to the consumer.
• Gibson Labs’ Magic technology can meet the needs of all industries and thus can be such a standard.

2:30 pm – 3:30 pm

Track A – Entertainment: Going Inside the Box: Developing Network-capable Multimedia Platforms

Moderator: Yuanzhe (Michael) Cai, Analyst, Parks Associates
Jim Chase, Director of Marketing, Home Media Connectivity Solutions, Oak Technology
Jim Hollingsworth, President of ReplayTV, Digital Networks North America
Mark Stiving, President, Destiny Networks
Jeremy Toeman, Products and Services VP, Mediabolic Inc.
Glen Stone, Director of Strategy, Standards and Architecture, Network and Systems Division, Sony Electronics
Mike Harris, CTO, Digital 5

This panel discussion provided differing views of how future network-connected entertainment devices will evolve. This panel was limited to one hour, but it was clear within five minutes of the start that the panel discussion could have lasted hours and that everyone in the room cared about the many issues under discussion.

• Are we having a convergence of networks or boxes?
• How will CE and PC industries achieve device/network interoperability?
• Issues of quality-of-service,
• The ease of user interface (What does that mean?)
• The need to improving ease of equipment set-up so that there can be transition from today’s home IT networks to tomorrow’s home entertainment networks;
• The need for end-to-end solutions with value-added services;
• A thesis that CE equipment reliability is better than PC reliability and is a strong attribute towards ensuring CE dominance.
• The consensus of the panel is that the key issue is how to bring different platforms together and let them communicate with each other. Both PCs and CEs are important parts of the network. DVD players can also serve as a good platform for distributing digital contents stored on the PC.
• This panel presented an alternate view of the Digital Home as CE driven instead of the PC-centric Home as described by Intel and Microsoft.
• Adoption of Home Networks will be evolutionary, not revolutionary, with current networked Consumer Electronic (CE) products being used by early adopters. One panelist commented that he did not think there were “home networks” yet. Yes, there were some IP networks that connect PCs and modems, and maybe a printer, but no home networks. Other panelists suggested that uncle Charlie and Aunt Mary (average consumers) should wait for another year before purchasing the so-called “new-converged platforms.”
• At the end, everything boiled down to cost and consumer education (simplicity). Yet, panelists agreed that there would still be many plugs in different shapes on your digital shoebox.

Track B — Wireless: Emerging Applications for Wireless

Moderator: Claudia Bacco, President, TeleChoice
Moderator: Kurt Scherf, Vice President of Research, Parks Associates
Sally Daub, CEO, ViXs Systems
Tom Flanagan, Worldwide Director of Broadband Strategy, Broadband Communications Group, Texas Instruments Inc.
Pierre Gandolfo , Board Member, WiMedia Alliance; Product Manager, XtremeSpectrum
Charles Gerlach, Communications Sector Lead, IBM Institute for Business Value
Stephen Saltzman, Director, Strategic Investments, Intel Capital
Bob Heile, CTO, Apparent Technologies; Chairman, ZigBee Alliance

The panel identified and discussed many wireless issues, including:

• The Wi-Fi or 3G debate; that is, which will win as network endpoints become wireless access points?
• Business model experiments are still looking for profit, and discussion of experiments included the wireless ISP managed hot spots vs. free-nets installed by cities for parks, by individuals and consumer groups for neighborhoods, by companies for customers so that they may use their broadband connection, and others.
• 802.11 VoIP phones still face many issues including cost, QoS, and roaming – first between access points and eventually between hot spots and broadband home or enterprise networks. This creates interesting opportunities (or threats) for wireless carriers.
• RF Interference can be addressed in several ways. CSMA listens before it talks, and WiMedia uses dynamic frequency selection and adaptive power management so the devices can avoid noisy channels and they don’t have to shout if nearby. Is there a “best practice” approach?
• Range limitations are a challenge. Range can be extended with Texas Instrument’s 802.11-over-coax technology and other techniques. Fast performance for video depends on screen resolution and bit rates that may change with range. ViXs addresses this.
• Regarding QoS for VoIP and streaming, panelists agree that TDMA (WiMedia) is superior to CSMA (802.11) for video, but that the markets will have both solutions.

Track C— The Visionaries: The Vision: Enabling Tele-Applications Across Categories

Moderator: Michael Greeson, Vice President, Principal Analyst, Parks Associates
Ori Balaban, Marketing Manager, M-Systems
Rajiv Jaluria, President and CEO, Sensitron
Jeff Perry, Director of Research & Development, Philips Telemonitoring Services
Sugata Sanyal, Director, PRONTO++ Software & Systems, Philips Electronics
Tim Woods, Vice President of Ecosystem Development, Internet Home Alliance

The panel first turned its attention to defining “telematics,” with one member joking that the auto industry invented this word to avoid the more mundane phrase “broadband-in-your-car.” Panelists discussed several potential applications and services, mostly drawn from the healthcare and automotive industries but with other industrial uses also noted. The potential benefits of telematics were then weighed against privacy concerns, with some agreement that legal issues must first be resolved before the field will properly mature. Finally, a debate ensued over how greatly telematics may benefit personal health. One side envisions that the immediate feedback provided by telematics will result in healthier lifestyles, while an opposing view stressed that individual will, more than technology, was needed to change people’s behavior.

• “Telematics” can be defined as remote monitoring services through an automated local presence.
• Telematics offers great benefits to the auto and health insurance industries.
• Privacy concerns, legal issues, and human nature may all limit the benefits of the technology.

3:40 pm – 4:40 pm

CLOSING PLENARY – Leader Reflections: Strategies for Investing in Home Networking

Moderator: Kurt Scherf, Vice President, Parks Associates
Bruce Eatroff, Executive Managing Director, BMO Halyard Partners
Jeremy Levine, Principal, Bessemer Venture Partners
Stephen Saltzman, Director, Strategic Investments, Intel Capital

Despite the burst of the dot-com bubble, the venture community is still seeking investment opportunities in the home networking space. This panel included Bruce Eatroff and Stephen Saltzman - from BMO Halyard Partners and Intel Capital, respectively - who are already quite active in providing capital to companies in home networking. The third representative - Jeremy Levine from Bessemer Venture Partners - is investigating whether home networking makes a good investment for his company at the present time.

Beginning on a lighter note, the panelists shared a laugh when asked by Kurt Scherf how much credence the venture community places in analyst forecasts for different markets. BMO Halyard’s Bruce Eatroff noted that the analyst community still provides investors with a very good understanding of how markets are likely to evolve. However, he – along with his fellow panelists – stressed that due diligence is an absolutely critical step in determining where capital can we wisely spent in this industry. Investors are looking for realistic business plans and for solutions that - although they may not be touted as “changing the world” - meet a well-defined market need.

Whole Home Entertainment Distribution — Creating Value Throughout the Chain

Moderator: Bill Rose, President, WJR Consulting
Moderator: Tricia Parks, President, Parks Associates
Steve Craddock, Sr. Vice President, Comcast
Vincent Izzo, Director, Advanced Home Services over Broadband, Motorola, Broadband Communications Sector
Dave Kummer, Senior Vice President Of Engineering and Systems, EchoStar Technologies Corp.
Ladd Wardani, Vice President, Business Development, Entropic

The panel focused mostly on the obstacles to whole-home entertainment distribution, noting that the lack of a quality distribution method was the primary challenge. DVRs and wireless LANs whet appetites for entertainment networks, but more is needed. Besides a storage medium such as a PC or media server, you need a way to get the content onto other devices such as TVs, stereos, PCs, and discs. Consumers have higher demands and expectations for entertainment products as compared to PCs, and they will not tolerate frequent interruptions of service nor complex installation procedures. Nonetheless, new digital services can increase revenue and reduce churn and are therefore still attractive to service providers despite technical challenges and digital rights management issues. In short, video distribution improves stickiness and cost savings without duplicating set-top stacks.

Providers need secure and profitable distribution, implying digital rights management and fewer returns. Consumers want fast and rock-solid connections with no excuses (no pause while “buffering”), and this demands better than today’s no-new-wires solutions. Connections in the rack and room will be wired with 1394 and wireless with WiMedia, and coax is preferred for whole-house distribution, since its multi-gigabit capacity can last for 20+ years.

Multiple video streams require at least 100 Mbps performance and even faster for smooth fast-forward. And while some content owners demand DRM, usage rules, and specific bandwidth and resolution, there’s plenty of non-restricted content available today.

To successfully sell new services, operators must first make consumers comfortable with it by offering free trials, and ease of use. Consumer challenges include awareness education, easier installation (existing media with no truck rolls), and no change to consumer behavior. Comcast, for example, offers free VOD to help sell users on pay VOD.

• Digital, in-home distribution methods still need considerable improvement and development.
• Benefits of new, digital services outweigh technical and legal concerns.
• New services must by easy, simple, and initially cheap in order to succeed.

9:15 am – 10:25 am

Track A — Entertainment: Multimedia Connectivity in the Home: PCs and CE!
Moderator: Andy Tarczon, Research Sales & Service, Parks Associates
Tim Bratton, VP of Wireless and Emerging Platforms, Listen.com
Karen Nelson Howe, CEO/General Manager, Singingfish Inc.
Vincent Izzo, Director, Advanced Home Services over Broadband, Motorola, Broadband Communications Sector
Joe Keller, Product Manager, Hewlett-Packard
Rob Lilleness, President and COO, Universal Electronics
David Manner, Director, Product Marketing, Adaptec

The panel presented differing views on the role of computers vs. traditional consumer electronics for digital entertainment and highlighted several challenges facing PCs. It was noted that a PC’s form factor makes it unsuitable for passive entertainment; consumers are and will remain reluctant to watch movies and television on a computer. Furthermore, the technical difficulties surrounding digital media adapters, particularly with regard to video, will make it hard to transfer content from a PC to other devices. Regarding CE platforms, the panel noted that a lack of interoperability between remote controls has frustrated consumers by forcing them to use several simultaneously. It also recognized that digital set-top boxes are simply becoming PCs.

• The market shows some positive signs as select services appear to be doing well.
• There are many challenges in using traditional PCs as digital entertainment hubs.
• Set-top boxes are rapidly becoming PCs as their capabilities are increasing.

Track C— The Visionaries: The Vision: Today and Tomorrow’s Innovations
Moderator: Michael Greeson, Vice President, Principal Analyst, Parks Associates
Tony Barra, Chief Strategy Officer, Internet Home Alliance
Win Burleson, Ph.D. Candidate, MIT Media Lab (Context-Aware Computing Group)

Tony Barra presented consumer market research that described the voice of the consumer. The talk presented three ecosystems: Family, Entertainment, and Career. Results indicate that work is not an isolated place anymore; 66% of consumers bring work home. Current research that addresses these ecosystems includes health and fitness needs assessment, calendaring, and community portals.

• Market opportunities exist between what is possible and what we think the consumer needs are.
• Consumers seem more interested in improving their daily routines and tasks over digital entertainment.
• Awareness and frustration are growing in the consumer mind about how to manage their digital content.

Best Buy, RadioShack, and Sears want home networking for mainstream consumers but must offer installation services, and this “geek mobile” support implies complexity. Embedded processors, sensors, and actuators will enable simpler products that discover each other and smart agents that learn. Tony Barra went on to describe some Internet Home Alliance trial projects, including Mealtime pilot, Family Ecosystem, OnStar at Home, and Work is Not a Place.

Win Burleson presented historical and recent research from MIT. Some of the research that was described was: the Smart Bed, Attentive Appliances, Wearable Devices, Intelligent Windshield, Intel Planetary Networks, Kitchen Counter Displays, Playful Appliances, Musical Lego Blocks, and Dynamic Architecture. Other research projects of note included:

• Sensors in clothing and personal ID that transmits through skin
• Monitor inner eye reflections to know where you’re looking
• Enhance reading with audio and sound effects
• Remembrance Agent projects hints on glasses.
• Intelligent Windshield for heads-up dashboard, GPS, computer display, and movies.
• Provide 1 mW of wireless power when near 802.11 network.
• Counter Intelligence adds smarts to food and surfaces.
• Robot pet provides companionship and assistance to elderly and measure vital signs.
• Movable wall panels separate spaces and control lighting and traffic patterns.
• MIT House project focuses on new technologies, design tools, and advanced construction methods.

Track D — Home and Hearth: How Connected Communities Can be Developed
Moderator: Kurt Scherf, Vice President, Research, Parks Associates
Ralph Ballart, Vice President, Broadband Infrastructure & Service, SBC Technology Resources
Bob Deane, Project Coordinator, My Connected Home
Marlee Lauffer, Vice President, Marketing/Communications, Newhall Land

The success of the “connected communities” concept rests heavily on the quality of partnerships created to execute the community benefits. . In the case of this panel, the partnerships formed include the service provider, the developer, and an integrator who can explain technology concepts in an easy-to-understand manner. The Newhall Land case study provides a good example of this interoperability between and among the players. As more than 50,000 fully networked homes become occupied, the two communities discussed may become benchmarks to apply to other similar projects.

10:45 am – 11:55 am

Track E — Distribution: Distribution Models for Home Networking Solutions
Moderator: William Ablondi, Director, ePanel Research, Parks Associates
Richard Holtz, President, Infinisys
Nancy Rae Kielty, Director Business Development, Best Buy
David McLean, Product Manager, Fluke Networks
Randy Stearns, President, Engineered Environments

The session focused on the challenge and opportunities of distributing products and services that provide connected home solutions in channels appropriate to the state of technology complexity and consumer requirements. Parks Associates forecasts that home networking will grow from its current U.S. HH penetration of 10%to 26% by 2007. These panelists discussed what channel options will make that forecast a reality. Among topics discussed were the following:

• The diffusion of structured wiring into US new starts;
• Home network installation services for the consumer;
• The role of entertainment vs. home control and monitoring as drivers;
• Consumer confusion in many parts of the country;
• High-end custom design market demand;
• The need for more trained installers and builders;
• The need to act and market on the knowledge that consumers respond to buying a lifestyle choice not a technology choice;
• Meeting consumers’ budgetary constraints.

Summary panelist opinions are below.

• Consumers are intimidated by home networking technologies, so the distribution channels must focus on lifestyle choices and benefits, rather than technology prowess.
• Mainstream consumers need help from the distribution channel to have home network solutions installed; channels that meet this need in a manner that is consumer cost-effective will be winners for these consumer dollars.
• The industry needs to train builders and installers to perform home networking related services for consumers.

Track D — Home and Hearth: Making it Matter: Delivering Residential Applications that Count

Moderator: David Dern, Marketing Director, CABA
Tony Barra, Chief Strategy Officer, Internet Home Alliance
Sanjeev Thakkar, Director of Business Development, MyCasa Network
Frank Homann, Executive Vice President, Zensys
Chris Wildfoerster, Manager of Business Development, Crestron Electronics
Bob Wise, President and Chief Operating Officer, Home Director, Inc.

Each panelist outlined his company’s position in the market, products and services, and views on the overall direction the market is taking. In short, these panelists find that digital services, especially entertainment, are very attractive to consumers, but also believe that the unreliability of PCs makes them an unsuitable platform for these services in the home. While the panel acknowledged the important roll of PCs, panelists believe that the PC itself is neither reliable and nor robust enough to be the controlling centerpiece of a networked home. Furthermore, several panelists discussed the speed of PC technology evolution as an obstacle to necessary long life requirements of a central home controller.

Discussion of CEA’s TechHome Rating System (www.ce.org) helps define the value of home networking technologies today, but what about 20 years out, since the PC industry has taught us that it’s difficult to imagine the future?

To help meet “length of system life” requirements, these panelists recommend using open and established standards, trusted brands and channels (e.g. Best Buy, Radio Shack, and Sears vs. custom installers), and wiring flexibility (home run). That’s why Home Director is based on Linux, IP, Java, XML, and HTML for the user interface supplemented by Flash.

In the end, service providers must sell “lifestyles” and not technologies or services. Because consumers generally “hate technology,” successful products will provide…

• Best value & ROI
• Lowest cost
• Longest life
• Highest reliability
• Strongest security
• Most flexibility and interoperability
• Installation, operation, and maintenance ease

Track C — The Visionaries: The Vision: International Markets
Moderator: Yuanzhe (Michael) Cai, Analyst, Parks Associates
Moderator: Kurt Scherf, Vice President of Research, Parks Associates
George Alexy, President and CEO, BRECIS Communications
Lixin Cheng, Director, Business Management, Ericsson Wireless Communications Inc.
Avner Matmor, President & CEO, ITRAN Communications
Graham Nicholls, CEO, Homeportal
Peter Strong, CTO, nSine

Although the main thrust for home networking concentration has been focused on North America in these initial stages, Europe and Asia will represent significant areas of growth. This panel consisted of representatives from a number of companies with experience in selling broadband and home networking applications to multiple markets, and they shared their perspectives on a number of topics.

With representation from two players in powerline communications on the panel (ITRAN Communications and nSine), it was interesting to hear their perspective on the possibilities for "last-mile" powerline broadband access. Both Avnor Matmor from ITRAN and Peter Strong from nSine expressed their skepticism that powerline broadband delivery would become a real competitive threat to traditional broadband access technologies in either Europe or Asia. Instead, they are focusing on in-home distribution systems that may complement offerings from energy companies.

Graham Nicholls from Homeportal indicated that the energy utilities in Europe and Asia may be more forward-looking in their plans to deliver additional value-added services to end-users. Given regulatory and market issues (i.e., sometimes inadequate energy supplies) in various international markets, Nicholls indicated that energy management applications (among a variety of value-added services) may indeed gain increased traction outside of North America, at least in initial stages.

Lixin Cheng from Ericsson shared his extensive experience about the Chinese market. He defined Guanx – frequently translated as relationship or connections – as “closed relationship” which requires mutual trust and personal friendship. When asked about the decline of Ericsson’s share loss in the Chinese handset market, he explained that Ericsson traditionally focused more on the improvement of the internal technologies of mobile phones and neglected updates of external features. The strategy proved to be inappropriate in a country where handsets were treated as fashion items and entertainment tools. He also elaborated on the difference between the Chinese/Asian market, where the focus was “from Mobile to Internet”, and the U.S. market, where the focus was “from Internet to Mobile.” The high penetration of mobile phones and relatively low penetration of Internet in China requires a mindset of creating Internet/data applications for the mobile phone platform, instead of the other way around.

CONNECTIONS™: The Digital Home Showcase and Conference, produced by Parks Associates in partnership with the Consumer Electronics Association, is the largest international executive conference for digital home technologies.

Market areas include broadband-related infrastructure and services, residential gateways, home networks, digital entertainment and home management. Speakers, panelists, and attendees see innovations, address technical challenges, network with peers, hear consumer research and business model presentations, and participate in industry discussions.