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To: Lizzie Tudor who wrote (60354)	8/23/1998 7:47:00 PM
From: jhg_in_kc	Read Replies (2) \| Respond to of 176387

TO ALL: Internet Devices Predicted to Topple PCs IS THIS CAUSE FOR CONCERN? The PC certainly isn't dead, but early lily requests are in order according to Forrester Research, which predicts that unit shipments will peak in 2002. Taking its place Forrester predicts a surge of Internet appliances featuring low-cost chips, application-specific designs and Internet connectivity. The research company credits the convergence of information and communication infrastructures around Internet protocols with fostering a diversity of Internet appliances that offer simplified setup, on-line software updates and high reliability, as well as lower prices. Such factors make Internet appliances an important alternative for both corporations and consumers seeking to reduce the cost and complexity of computing. Forrester sees the market for Internet appliances developing around three broad categories: computing devices, such as palmtop and handheld computers and network computers (NCs); communications devices, including fixed screen phones, smart mobile phones and pagers; and television products, like digital set-top boxes and Web TV. According to Forrester, in the United States corporations will lead in the adoption of computing devices, where various forms of Internet appliances already constitute a nearly $6 billion market. The prediction is this market will reach more than $16 billion in 2002. "Firms are reaching the limits of what they can achieve in a PC-centric architecture," said Carl D. Howe, director of Computing Strategies at Forrester. "Over the next five years, we expect to see companies forsake the 'PC for everything' approach and start moving toward specialized devices with limited but well-understood functions. The simplicity, reliability and performance of Internet appliances will enable corporations to revamp their computing environment." U.S. consumers will tag along a little more slowly, Howe said, with cost, convenience and functionality being key factors in their purchase decisions. He said the ability to send and receive voice and data through smart cell phones and wireless palmtop computers will appeal to career-oriented consumers seeking greater connectivity in a single, portable package. Consumers motivated by entertainment options will embrace next-generation set-top boxes and game consoles, while screen phones will be the logical choice of consumers who view technology with some skepticism. "Internet appliances can deliver value to consumers by supporting their information needs," explained Cliff Condon, senior analyst in Money & Technology Strategies at Forrester. "A cell phone with a built-in browser that allows users to check their balance or transfer money before making a purchase, for example, offers a convenience factor that consumers will find compelling." In Europe adoption will vary from country to country, with the highest penetration coming in markets where technology is already in wide use. Forrester estimates that 19 million Internet appliances will be Internet-enabled by 2001. The net impact will be an additional 7 million Internet users by 2001. "With mobile phones already in wide use throughout Europe, Internet-enabled phones will be the early appliance leader," said Therese Torris, director of New Media Analysis with Forrester's European New Media Strategies service. "Digital set-top boxes and televisions will make a strong showing in Germany and the Netherlands, while Internet-enabled screen phones will lead in France. Computing devices will also make gains, but much more slowly." Forrester's views on the future of Internet appliances can be found in three recent reports: "Corporate Appliances," written by Forrester's Computing Strategies service; "Money Gadgets," from the Money & Technology Strategies service; and the European New Media Strategy service's "Net Appliances In Europe." Information on the reports can be found at www.forrester.com . Back to Table of Contents