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Broadband Providers to Grow Home Networking Market

The number of broadband households with a residential gateway (RG) will reach 69 percent by 2009, according to new data.

Dallas, TX–The number of broadband households with a residential gateway (RG) will reach 69 percent by 2009, driven in large part by service providers, according to Home Networks & Residential Gateways: Analysis and Forecasts, a new study from Parks Associates.

The report predicts home networking, as both equipment and service offerings, will be a major component in the competitive strategies of broadband carriers in the next five years. During that time, cable, DSL, and other broadband vendors will take aggressive steps to deploy voice-over-IP (VoIP) and multimedia services, which will boost the market for RGs.

“Home networking equipment is shifting from low-cost and relatively limited devices sold at retail to integrated modem and router platforms that offer multimedia applications and advanced management software,” said Kurt Scherf, vice president and principal analyst at Parks Associates. “Broadband carriers are beginning to dictate the pace of the market for home networks, creating significant opportunities for third-party vendors to support more advanced features via customer premise equipment (CPE) and software solutions.”

Many broadband providers, once reluctant players in the home networking arena, now view the deployment of network- and multimedia-capable CPE as a significant move to promote customer retention, lower support costs, and ultimately produce higher revenues, according to Scherf.

“In addition to building a more loyal customer base, the RG helps reduce support costs by providing a solution more integrated with a carrier’s unique network and business needs,” Scherf said. “Software partners who can assist both the carriers and equipment vendors in developing cost-effective CPE and provisioning services will be key partners in the home networking value chain.”

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