Residential broadband access was slow to take off, but with penetration now rapidly approaching tens of millions of households in both Europe and the United States, companies are making major bets on building broadband applications to reach all those potential customers. The technology and its potential uses have been the main points of interest to date, but now companies need a realistic view of the economics that underlie broadband applications, the ways those applications will affect the industry’s development, and the size of the opportunities likely to emerge over the next few years.
Some long-cherished beliefs—such as the idea that broadband would finally bring about the convergence of PCs and TVs in a single device—will be dashed. Companies have been trying to combine the two for years, and broadband added an even more appealing logic: as high-speed, always-on connections spread, one type of screen would be as good as another for viewing entertainment. Consumers, the thinking went, would naturally favor the PC for its processing power, so PCs, in addition to handling e-mail, Internet access, and routine computing tasks, would also become the way to access entertainment. As uniform standards emerged, this winning device would incorporate the TV’s huge...
Some long-cherished beliefs—such as the idea that broadband would finally bring about the convergence of PCs and TVs in a single device—will be dashed. Companies have been trying to combine the two for years, and broadband added an even more appealing logic: as high-speed, always-on connections spread, one type of screen would be as good as another for viewing entertainment. Consumers, the thinking went, would naturally favor the PC for its processing power, so PCs, in addition to handling e-mail, Internet access, and routine computing tasks, would also become the way to access entertainment. As uniform standards emerged, this winning device would incorporate the TV’s huge...
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