Wireless Living - US - March 2005

SUMMARY

A growing number of personal computing and consumer electronic devices traditionally requirewires to connect with other devices in order to exchange data. An assortment of devices such asdigital camcorders, DVD players, mobile communications products and high-definition TVs (HDTV) haveall depended on this wire-bound technology. However, wireless technology is poised to help consumerseliminate the wires, allowing them a higher degree of flexibility and convenience in their homes andlives.

This report captures the dynamics of wireless product usage in homes by U.S. consumers. While therange of wireless products is massive, Mintel focuses on products most relevant to what is referredto for this report as "wireless living." At the core of this product group are highlypenetrated devices such as cordless phones and universal remote. However, Mintel examines a widevariety products such as Wi-Fi networking equipment and wireless VoIP handsets. All of these devicesallow consumers to cut the cords, save time and find wireless solutions in their homes .

On a broad level, the realm of wireless living includes three system types that can be deployedin the home-many of these include devices which may be interconnected. This report examines thecurrent and future market for wireless devices within the context of these three home networks:

• the home computing network (connects PCs, laptops and other devices)
• the home entertainment network (includes media centers, TVs, audio systems and gaming devices)
• the general household network, (includes emerging technologies such as VoIP telephones,networked appliances and home security systems)

TABLE OF CONTENTS

Introduction and Abbreviations

• Introduction
• Other relevant reports
• Definition
• Abbreviations & terms
• Abbreviations
• Terms

Executive Summary

• Introduction
• Demand for home entertainment systems, fast Internet and standardization drive growth
• Market expands, strong growth expected
• Data networks and home automation important, but entertainment systems drive expansion
• Competition for the wired living room will drive innovation
• Mainstream consumers targeted with simplicity, affordability
• Diverse retailers cater to wireless living market
• Young families key to market growth
• The future of the wireless living market

Market Drivers

• State of the networked home in 2005
• Figure 1: Wireless home network application classifications
• The evolution of standards expands foundation for wireless home networks
• Figure 2: Classification of wireless network types, 2005
• PANs and LANs operate inside wireless homes
• Figure 3: Performance characteristics for standards critical to wireless devices in the home,2005
• Number of households with WLANs increases steadily
• Figure 4: Total U.S. households with wireless home networking equipment, 2002-04
• Figure 5: Graph: Total U.S. households with wireless home networking equipment, 2002-04
• Figure 6: Total high-speed Internet penetration and forecast, 2002-07
• Wireless networks are gatekeepers of other CE products in the home
• Home entertainment driving wireless CE products in the home
• Figure 7: Prevalence of music-related and other online activities in past 30 days, by gender,January-September 2003
• Figure 8: High-definition television unit sales projections, 2003-07
• Figure 9: Manufacturer sales of select home audio equipment, segmented by product type, 2003-05
• Figure 10: Household devices connecting with the Wi-Fi standard, 2004
• Retailers, manufacturers offer convenience of wireless, education

Market Size & Trends

• Figure 11: Total core U.S. wireless living households, 2002-04
• Figure 12: Graph: Total core U.S. wireless living households, 2002-04

Market Segmentation

• Introduction
• Figure 13: Home wireless market, segmented by computing, entertainment and household CE devices,2002 and 2004
• Wireless computing
• Figure 14: Total retail sales of wireless computing equipment, at current and constant prices,2000-04
• Wireless entertainment
• Figure 15: Growth of computing and entertainent networks, 2003-08
• Figure 16: Annual unit sales of media adapters and PCs, 2004-08
• Media Center PCs
• Digital Media Receivers (DMRs)
• Digital Media Adapters (DMA)
• Wireless automation-revisited
• Figure 17: Forecast revenues for home automation network systems, 2000-07
• Figure 18: Household penetration of unlicensed wireless devices, 2003
• Wireless VoIP
• Figure 19: VoIP penetration and forecast, 2004-08

Supply Structure

Companies and brands

• Wireless data network suppliers
• Figure 20: Retail sales of home wireless networking equipment worldwide, 2002 and 2004
• Cisco-Linksys
• D-Link
• Netgear
• Wireless entertainment network devices
• Figure 21: Media center market share estimates, 2003
• Hewlett-Packard Company (HP)
• Sony Corporation
• Toshiba Corporation
• Wireless household device suppliers
• VoIP
• Figure 22: Market share of IP phones, by vendor, worldwide, 2004
• Home automation
• Motorola
• X10
• Smarthome

Advertising & Promotion

• Simplifying technology
• Incentives encourage first-time trials

Retail Distribution

• Figure 23: Purchase of A/V equipment, by retailer, July 2004
• Figure 25: Retail prices for in-home installations of wireless networks and flat-panel TVs,January 2005
• Specific retail channels and retailer profiles
• Best Buy
• Corporate Activity
• Circuit City
• Corporate Activity
• Electronics Stores Operating Data
• Figure 26: Top electronics stores operating statistics, latest fiscal year-end
• Figure 27: Percentage change from latest fiscal year-end versus year prior

The Consumer

• Introduction
• Understanding wireless living technologies
• Figure 28: Respondent understanding of wireless living technologies, January 2005
• Figure 29: Respondent understanding of wireless living technologies, by presence of children,January 2005
• Figure 30: Respondent understanding of wireless living technologies, by gender, January 2005
• Figure 31: Respondent understanding of wireless living technologies, by age, January 2005
• Figure 32: Graph: Respondent understanding of Wi-Fi, by age, January 2005
• Wireless living products ownership
• Figure 33: Incidence of wireless living products, January 2005
• Figure 34: Incidence of wireless living products, by household income, January 2005
• Figure 35: Incidence of wireless living products, by age, January 2005
• Figure 36: Incidence of wireless living products, by presence of children, January 2005
• Ownership details for select wireless living products
• Figure 37: Connected components on wireless home networks, July 2004
• Figure 38: Deployment of wireless home network hardware, July 2004
• Attitudes toward wireless living technologies
• Figure 39: Attitudes toward wireless living products, January 2005
• Kids and Wi-Fi
• Figure 40: Attitudes toward wireless living products, by presence of children, January 2005
• Figure 41: Attitudes toward wireless living products, by gender, January 2005
• Figure 42: Attitudes toward wireless living products, by age, January 2005
• Attitudes toward wireless living and safety
• Figure 43: Attitudes toward wireless living and safety, January 2005
• Figure 44: Attitudes toward wireless living and safety, by presence of children, January 2005
• Figure 45: Attitudes toward wireless living and safety, by gender, January 2005
• Intent to buy
• Figure 46: Intent to purchase wireless living products in next 3 years, January 2005
• Figure 47: Intent to purchase wireless living products in next 3 years, by age, January 2005
• Figure 48: Intent to purchase wireless living products in next 3 years, by presence of children,January 2005
• Summary

Future & Forecast

Future trends

• Improvements and price drops in wireless technologies to spur adoption
• Wireless standards now robust enough
• Ultra Wideband: the next "killer app"?
• Home automation standards
• Wireless living has discriminating focus on design
• Convergence has consequences: viruses invade realm of CE

Market forecast

• Overview
• Figure 49: Total core U.S. wireless living households, 2004-09
• Figure 50: Graph: Total core U.S. wireless living households, 2004-09
• Forecast factors

Appendix: Trade Associations and Publications

Appendix: Research Methodology

• Consumer Research
• Sampling & Weighting
• Presentation & Definition
• Further Analysis
• Trade Research
• Informal trade research
• Formal trade research
• Desk & Internet Research
• Sources
• Definitions
• Forecasts

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