LONDON, ENGLAND, 1999 DEC 23 (NB) -- By Steve Gold, Newsbytes. Research just published for the year-end predicts that the European Internet appliance market will be worth a whacking $6 billion by 2005.
The report, from Strategy Analytics, says that, at that stage, Internet appliances will be in 57 percent of European homes and, perhaps surprisingly, will not replace home PCs, but will co-exist quite happily with the machines.
By 2005, the report says, some 74 percent of European homes will be online and 81 percent of them will be using an Internet PC. However, nearly as many will also have interactive TV or another Internet appliances.
The report, entitled "The Online Home - The Market for Internet and Online Devices," concludes that, while the PC will remain a dominant fixture in the household, online TV-based set-top boxes will also become commonplace.
Strategy Analytics also says that limited demand also exists for a range of new Internet terminals which are independent of the PC or TV, such as screenphones and Web terminals - sales of such devices will reach $300 million in Europe by 2005.
In addition to this, the firm says that sales of interactive TV appliances, such as online digital TV set-top boxes and advanced game consoles, will reach $4 billion in Europe in 2000 - an increase of 15 percent on the current year.
Sales, meanwhile, will peak at $5.5 billion in 2002, before declining to $4.4 billion in 2005 under the impact of falling prices. Shipments, however, will reach 11.7 million units in 2000, and rise at an average growth rate of 25 percent a year, reaching 30.1 million units a year by 2005.
David Mercer, a senior analyst with the firm, says that the online home is about multiple devices for multiple applications.
"In the future, consumers will be online all the time, and from many rooms in the home, although they may not even be aware of it," he said, adding that the average European online home will have 2.5 online devices by 2005.
This, he said, represents an emerging opportunity for service providers and network operators, which will compete to become the "preferred supplier" to this range of different appliances.
The report concludes that it will also reinforce the trend towards home networking and the need for broadband, always-on connections.
Strategy Analytics' Web site is at http://www.strategyanalytics.com .