What started out as a way to connect PCs and share an Internet connection, the functionality of home networking has grown to include audio, video, telephony and residential gateway systems. For real estate agents, 2004, the year of the digital consumer, may just be the beginning of a new paradigm in residential real estate transactions.

Consider, at the 2004 International Consumer Electronics Show (CES) in Las Vegas, 129,328 technology executives visited 2,491 companies in 1.38 million net square feet of exhibit space where thousands of new products and technologies were announced—a great deal centered on the home. To this writer, 'the future of the digital lifestyle is so bright, I have to wear shades.'

"The innovation, phenomenal products, convergence of technologies, people and excitement were unprecedented," said Gary Shapiro, president and CEO for the Consumer Electronics Association (CEA), the producer of the International CES. "While it may have been 'plastics' in the 1960s, this era's technology is consumer electronics as leaders from IT, cable, broadcasting, entertainment, education, transportation, and government converged in Las Vegas for CES."

For real estate agents on the go—armed with cell phones, laptops, PDAs, ekeys, display boxes, and more—this digital phenomena is nothing new. What is new, however, is a consumer purchasing wireless and home networking products at an alarming rate. According to the CEA, total factory sales of consumer electronics in 2003 is estimated to reach 96.3 million, up from the $85.5 million in 1999. The Association projects sales to surpass $116.9 million in 2007.

"...while PCs and peripherals will remain the most common devices found on home networks, networked digital entertainment devices will drive the next generation of consumer electronics," explained Parks Associates, a premier market research and consulting firm focused on all product and service segments that are digital or provide connectivity within the home.

The networked home figured prominently at CES this year as more home owners demand access to content and home control features anywhere and at any time. Content now can be stored in the home PC or other products such as media servers and controlled by wireless or Web-enabled remotes.

"Today's consumers are looking for convenience, choice and control when it comes to their home entertainment experience," said Michael P. Harney, corporate senior vice president and president of Subscriber Networks, Scientific-Atlanta, a leading supplier of digital content distribution systems and transmission networks for broadband access to the home.

"Given that most of what consumers do with home networks today are PC centric tasks, it is not surprising that most consumers said they would turn to PC companies to supply their networking gear," said Stephen Baker, The NPD Group's director of industry analysis. "The question for the future is how consumers will view these providers when the uses begin to involve more extensive inclusion of home entertainment gear."

Media servers, a focus of most non-PC product suppliers at the CES, are devices that transfer music, pictures and video (soon) from a PC to an A/V system. They are basic; single-purpose products, that utilize both wired and wireless technology to transfer the data.

"As PCs evolve to become entertainment centers and as 'thick client' media servers find their way into consumers' homes, digital televisions, MP3 players, CD players, and audio receivers will soon compete with PCs and printers for a dominant presence in the home network," added Parks Associates.

While there is no one true definition of a wireless network—it could mean the cellular and PC connections used by mobile phones to receive and transmit audio and data files, or the remote panel that controls the heating and cooling inside a home—the driving force in the consumer electronics industry is WiFi (wireless fidelity); wireless computing that operates under the 802.11 LAN (local area network) specification and operates over the 2.4Ghz and 5Ghz radio bands. (The 802.11 refers to a classification system used by the Institute of Electrical and Electronic Engineers.) To better understand how a WiFi network functions, think about an office with networked PCs. While computer networks connect via Ethernet cable, wireless networks connect without the cabling/wiring. They operate under the radio band frequencies outlined above, similar to the way walkie-talkies or baby monitors communicate.

"As consumers begin to embrace the technological changes by the current wave of digital convergence, home networking will be one of the first technologies to which consumers will be exposed," said Baker. "The reality of today's home networking falls far short of what the networked home of the future will look like. Today's network owners recognize that while they would like to do more with their home networks, the current technology has limits."

Flexibility, ease-of-use, and greater control are all reasons why home networking solutions will continue to prosper and will ultimately be an integral reason why one house may be more attractive than another in the eyes of today's tech-savvy home buyers.

Editor's Note: Peter L. Mosca is president and founder of Howell-NJ-based BAK Communications, Inc. Peter is a frequent speaker to organizations of all sizes on a wide range of communications topics, each aimed at helping individuals and organizations identify ways to better the flow of information to key internal and external publics.

The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the consumer technology industry through technology policy, events, research, promotion and the fostering of business and strategic relationships. CEA sponsors and manages the International CES—Defining Tomorrow's Technology. All profits from CES are reinvested into industry services, including technical training and education, industry promotion, engineering standards development, market research and legislative advocacy.