Report says connected communities will become more prevalent

March 5, 2003
March 5, 2003 - But market has been slowed by an absence of services needed for fiber-to-the-home.

While the connected communities concept may encounter several barriers, these communities will continue to become more prevalent and will offer a significant opportunity for developers and providers alike, reports In-Stat/MDR.

The high-tech market research firm finds that this market may be slowed by such barriers as a lack of expertise in broadband networks and services on the part of developers, an absence of the services needed to necessitate an advanced fiber-to-the-home (FTTH) network, and the traditionally slow build-out of Greenfield communities.

However, developers continue to embrace the idea of using technology as a competitive advantage, and a plethora of providers, of all shapes and sizes, are moving into the market.

In-Stat/MDR expects strong growth in the number of connected community homes through 2007, with the market experiencing a 45.5% growth rate in 2003 and increasing in 2004 and 2005 as it recovers and new resources are available to providers in the space.

"The Master Planned Community (MPC) is a unique and interesting arena for broadband services, both in the types of solutions deployed and in the forces driving deployment," says Amy Cravens, an industry analyst with In-Stat/MDR. "Currently, the MPC is at the leading edge of residential broadband services, being a principal market for fiber-to-the-home and triple play services. Developers and providers are realizing compelling business opportunities for broadband enabling these Greenfield communities."

In-Stat/MDR also reports that:

* Service revenues in the MPC will grow from a total of $66.9 million in 2002 to $727.8 million in 2007,

* While FTTH continues to grow in the MPC, cable will remain the dominant technology through 2007. One reason for this is that the cost of FTTH has not fallen as rapidly as had been anticipated, making this solution not as cost effective as cable in many scenarios,

* According to a recent survey of residential developers, almost 75% indicated that at least a percentage of their communities allowed for a broadband connection to
every home. These figures indicate that the concept of a connected community is no longer a rarity, but is becoming a standard in new communities.

The report, "Connected Communities: Broadband Services in Master Planned Communities," discusses the various last mile networks deployed, service suites delivered, and business models that govern the MPC market. Additionally, forecasts of homes connected, by technology, and service revenues for 2002-2007 are included.

In-Stat is based in Scottsdale, Ariz. To purchase this report, or for more information, visit www.instat.com.

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