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Is the Home Technology Revolution
in Jeopardy?

by Motive Communications, Inc. www.motive.com

The "Home Technology Revolution" faces significant hurdles and vendors must think beyond product innovation for mainstream America to catch up to early adopters of advanced home entertainment, home networking and home automation technologies. This challenge was a topic of heated debate at a recent industry roundtable event called, "Is The Home Technology Revolution in Jeopardy?" attended by senior executives from 3Com, The Internet Home Alliance, Hewlett-Packard, LINKSYS, Motive Communications, Odyssey and Verizon Connected Solutions.

The roundtable participants gathered in Silicon Valley to discuss current challenges and future strategies for delivering the "smart, connected home." According to a recent Harris Poll, 47 percent of Americans are familiar with the concept of a smart, connected home and 51 percent of Americans indicated they would be willing to pay up to ten percent more for a "smart" product with self-repair and other conveniences. However, this figure is tempered by findings that 44 percent of those polled said they are intimidated by the smart, connected home because they don't understand how the technologies work.

"I predict that it will take five years for the 'integrated home' to become more commonplace, where things like broadband are treated as a simple utility," said Jim Kenny, general manager, marketing and new market development, Verizon Connected Solutions. "The revolution is actually a constant evolution and to succeed, technology companies need to understand that the home is an ever-changing environment, where personal tastes, economic factors and convenience needs change."

Although the fully automated, self-maintaining home remains a cool concept that has yet to see fruition outside a controlled setting, the executives agreed that the home technology revolution has been significantly bolstered by the growing popularity of broadband, home networking, and hi-tech entertainment products, such as digital video recorders (DVRs) and gaming consoles. This trend is mirrored by the Harris Poll findings, which indicate that nine in ten Americans (92 percent) own some sort of technological device at home.

The roundtable participants went on to debate three major hurdles that stand in between the home technology revolution breaking into the mainstream:

-- Technical service and support: products are only becoming more complex, and with multiple devices, smart appliances and equipment converging on the home, service and support issues will weigh heavily on the consumer's mind. The Harris Poll found that 60 percent of Americans are concerned that service and support will be inadequate if something breaks down in the smart home.

-- Product interoperability: with interconnectivity (and centralized control) being one of the key selling points of the smart, connected home, a lack of standards was cited as an impediment to collaboration between broadband providers, device manufacturers, and other high-tech companies, whose products are complementary, but to date are ill suited to work together and allow easy, ongoing use for the consumer.

-- Broadband adoption: cost, service availability and lack of infrastructure have shut out certain segments of the population. With a high-speed broadband connection being a key requirement of the smart, connected home, many consumers are left without the ability to upgrade from dial-up service and experience a richer set of Internet functionalities, or network their home.

"The promise is there for the Smart Home to impact people's lives in a meaningful way, but so much has yet to be done from a cost, infrastructure, and education perspective," said Tony Barra, president of The Internet Home Alliance. "Those vanguards who are taking small steps in this evolution are gravitating towards home networking as the 'killer app,' which in the future should open the doors to more sophisticated capabilities, like home automation."

The final discussion was around the issue of "owning" the customer. With different technologies from various vendors converging on the same infrastructure, who would be held accountable for a variety of service issues, from technical support, to service upgrades and the looming possibility of vendor consolidation? Vendors naturally want to shape their own unique relationships with the customer, which is made more complicated when boundaries between interconnected products are blurred.

"No consumer will want to approach multiple vendors to troubleshoot problems with their broadband connection, set-top box, DVD, and game console," said Scott Harmon, CEO and co-founder of Motive Communications, a provider of service automation software. "Simply put, they should not have to be the systems administrator for their household. The roundtable event identified a huge chasm between vendor innovation and consumer realities. Communicating the benefits of the smart home is an area in which we all need to improve for the home technology revolution to really take off."

CONTACT: Claire Campbell-Seeger of Motive Communications, Inc., , ext. 2408, or ; or Ana Mangahas of Blanc and Otus, , or , for Motive Communications, Inc.

Website: www.motive.com Motive Communications, Inc. provides intelligent service solutions for the world's leading digital brands. Motive's industry leading software and service expertise enable technology innovators to create a new generation of "smart products" that deliver service as an integral part of the user experience.

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