Should You Buy an Internet Appliance?

Should You Buy an Internet Appliance?

Let’s say you’re not yet online and want to get there but don’t want to mess with a complicated computer. Or let’s say your parents or grandparents fit this description. What should you do?
This question has spawned an entire category of simple Internet access devices called Internet appliances. Yet these devices have failed miserably in the marketplace. Exploring why sheds light on the challenge of getting a senior citizen online and, if you’re a senior citizen, what your options are today.
Clearly there’s a potential market out there. The latest data from market research firm Dataquest shows that 39 percent of U.S. households still aren’t online. A whopping 85 percent of U.S. senior citizens don’t yet have Internet access, according to the Pew Internet & American Life Project.
Yet within the past year, three major manufacturers of Internet appliances have dropped out of the market: Sony, 3Com and Netpliance.
The sole surviving stand-alone Internet appliance actively marketed to consumers is Compaq’s iPAQ Home Internet Appliance, which I and my 74-year-old father tested in detail and which, despite great potential, has problems of its own.
Compaq sells two versions that are both attractively priced. The smaller and more portable IA-1 has a flat-panel screen and retails for $399, and the bulkier IA-2 has a conventional computer monitor and retails for $299. Prices at consumer electronics stores, where they are typically sold, are sometimes even less.
Both units operate similarly. They look and act like PCs but lack a hard drive, which is appropriate since Internet appliances aren’t meant for storing letters, budgets, and so on. Without a hard drive, there’s no waiting for the device to “boot up” when you turn it on.
Compaq’s Home Internet Appliance is designed for surfing the Web, sending and receiving e-mail, and engaging in instant messaging. It’s easy to set up and use.
The biggest negative is that it’s inextricably bundled with MSN Companion, Microsoft’s operating system for Internet appliances. MSN Companion is tied closely to MSN Internet Access, and like the MSN Internet service provider (ISP), it’s slow and buggy. Consumer Reports recently ranked MSN last among eight national ISPs for speed, interruptions and availability.
You don’t have to use MSN to connect to the Internet with Compaq’s Home Internet Appliance. But as just one more example of Microsoft’s monopolistic mindset, because of Compaq’s licensing agreement with Microsoft, if you use another ISP, you still have to pay Microsoft $9.95 per month in addition to the fee you pay your new ISP.
On the positive side, if you stay with MSN, your first six months of access is free. After that, though, access costs $21.95 per month.
Some reviewers found the screens of Compaq’s Home Internet Appliance too small and the touchpad finicky, but we had no problems with either. More problematic is that the device doesn’t support a number of widely used Internet formats from companies other than Microsoft, such as Adobe Acrobat, RealAudio and QuickTime.
Browsing Internet forums revealed that typically advanced users found the limitations too limiting while beginners appreciated the ease of use. This leads to the core of the Internet appliance quandary for manufacturers.
They have failed thus far at marketing these devices to their logical audience, the “Net laggards,” so now they’re marketing them to the “Net sophisticates” who want more than one Internet access device in their homes. But this audience will not likely tolerate the devices’ technological limitations.
Compaq officially says it’s committed to the Internet appliance market, and it seems to recognize the way to improve the device. “In the future we hope to provide access not tied to Microsoft,” says Compaq spokesperson David Albritton.
But the larger challenge remains: Persuading ‘Net laggards that paying for ‘Net access is worthwhile. “This audience will wait until they absolutely cannot do without,” says Bryan Ma, an analyst from IDC, a market research firm in Framingham, Mass.
Does it make sense to buy the Compaq Home Internet Appliance? Despite the current limitations, maybe. The price is right, and it’s suitably simple if you’re just getting started.
Another option is MSN TV, formerly called WebTV, a device ranging in price from $99 to $199 that you connect to your TV for Internet access. It’s from Microsoft, easy to use, but even more limited. The older WebTV Classic is also available, even less expensive, and still more limited.
For freedom of choice, if you can swing it, it can make sense to spend $600 to $800 on a low-end PC or Mac, which are easier to use than ever. 

Reid Goldsborough is a syndicated columnist and author of the book Straight Talk About the Information Superhighway. He can be reached at reidgold@netaxs.com or .



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