According to ABI Research’s study "Home Networking and Digital Home Network Market Analysis," growth in the market for core home networking products has been slowing in recent years, due to market saturation and price erosion. The decline is not helped by the current global economic slump: forecasts for core home networking device revenues indicate a declining market through 2014.
However, the network connected media device market segment continues to show strong growth. The result, according to ABI, is that total revenues for network-connected devices will rise from about $74 billion this year to more than $94 billion in 2010.
"Network connected media devices such as game consoles, TVs, and set-top boxes offer an opportunity for ‘core networking’ companies to reorient themselves away from a declining market," said senior analyst Jason Blackwell in a statement. "Home network device vendors such as Linksys by Cisco and Netgear, as well as networking silicon vendors such as Broadcom, are targeting these growing product categories aimed at home entertainment networking and connecting consumer electronics devices to the network."
Other vendors targeting this space include Apple, Roku and Vudu.
The best opportunities in the media networking market will arise from the growth of video and audio distribution around the home, as well as from new services that will be offered by service providers. Initially, Wi-Fi will provide the majority of connections; Ethernet will place a strong second. Over time, powerline, coax, and high-speed wireless connections will show strong adoption growth rates, ABI said.