Digital home diary

Observations on this year’s Connections 2003 conference

The mood at this year’s Connections 2003 Digital Home Conference and Showcase in San Jose fluctuated between hope, crankiness and despair. Rousing presentations from Intel, Microsoft and Philips painted glorious visions of the digital home of the future — the market these 550 or so vendor attendees are betting their banks on. There was even a presentation by MIT’s Media Labs featuring attentive appliances, intelligent windshields and conductive cosmetics. 

No one would argue the vision is a mirage, would they? Broadband adoption keeps climbing; consumers are stuffing their hard disks full of digital media; 30% of U.S. households have two PCs; 10.5% have networked them, likely with cheap and easy to use Wi-Fi. New game consoles include Ethernet and wireless, Media PCs are hot, HDTV is around the corner, and sales of Tivo and Replay TV personal video recorders are picking up. The stage is set to start bringing everything together — right?

Yes and no. While the technology is here — oodles of architectures, infrastructures, protocols and standards — no one can agree how it should all fit together. And without agreement, there’s no clear message to bring to consumers, retailers or service providers.

Connections is hosted by Dallas boutique research firm Parks Associates, which focuses exclusively on home networking, in conjunction with the Consumer Electronics Association. In her opening remarks, President Trisha Parks summed up the problem best: “Distribution is the linchpin. Without it, we’re all wearing a bunch of suits without zippers.”

But what are we distributing, exactly? There was agreement the digital home architecture will center around a smart device that will store, manage and distribute the home’s digital media to a variety of dumber, cheaper devices throughout the home, over one or many network protocols such as Ethernet, coax cable, power line or wireless. Not a new idea, but a seemingly stable one.

Microsoft says the smart box will be a PC. Motorola says it’ll be a cable set top box. Many say the argument is foolish; there’s room enough in the boat for everyone. There was squabbling over what services consumers will pay for, a sore spot because providers have been so slow to partner up. Some argued they’ll only pay for entertainment and a fatter pipe for gaming, and the service provider will need to offer free antivirus and firewall services to differentiate their offerings. Others are dead sure consumers will pay for content filtering and parental controls. Even so, that’s a small part of the overall market, someone pointed out.

All agreed entertainment would be “the next big wave.” But no amount of debate was going to ease the sense that a lack of standards, as well as digital rights management and copyright protection issues, are holding back an already ailing young market.

Hence dramatic moments like when Jeremy Toeman, products and services vice president at Mediabolic — a company that makes embedded middleware for entertainment devices — burst out during a panel discussion: “We don’t have home networks today. We have IP networks that connect PCs and DSL modems, and maybe a printer!”

Or when Parks, in an effort to infuse some positive energy, asked a panel: “So what’s happened that’s started that’s good?” and was received with dead silence. Finally, Comcast Senior Vice President Steve Craddock offered, “Wireless is much easier to install than it was two years ago.”

And I hear a fist fight nearly broke out among some vendors on a wireless panel, but I missed it, hoping to learn something new from a talk on “whole home distribution strategies” instead. Bad call.

There were a couple of funny moments too, like when Bruce Mehlman, the Commerce Department’s assistant secretary for technology policy, said, “Everybody in Washington loves broadband, but only half know what it is.” Or when I met a vendor who works for home network systems integrator IONA Home Systems. “Our name is a bit of a joke,” he said. “When you buy from us, you can say ‘IONA home network.’ ”

Near the end of the third day everyone looked pretty sore from all the head banging. None of these entrepreneurs could figure out how to dominate the market, which meant Microsoft and Intel would do it for them. The time had come for the most useful panel presented: Three venture capitalists set to impart the secrets of getting funding. The room was packed.

Don’t get me wrong; there’s still a lot going on in this market, even if there isn’t a lot of money being made. There are interesting developments with network protocols like Zigbee and WiMEDIA, some power line developments from ITRAN Communications and the reborn nSine Communications, and new technologies from Entropic (100-200M bit/sec over coax) and even Gibson — the guitar people whose tagline is “Watch for flying panties.” Ah, there’s hope yet. Stay tuned.