Wednesday - September 6, 2000

Home Office Households Approach 37 Million Because of the Internet

The growing number of home office households will continue to spark advanced technology use in the home, according to IDC. The Framingham, Mass.-based market research firm says the number of households with some form of home office activity is now approaching 37 million and will come close to 39 million in just two years.

"The changing use of technology is making it easier to establish and use a home office than ever before," said Mary Porter, senior analyst with IDC's Home Office research program.

IDC's new report, U.S. Home Office Forecast and Analysis: 1999-2004, notes PC penetration and Internet use in home offices are now at record levels. While 52% of U.S. households had a personal computer at the beginning of the year, the share was significantly higher among home offices: 78%.

According to IDC, home office households are leading the way in other technologies as well. "In addition to access to computers and the Internet, home offices are using a variety of mobile communications to stay in touch even when away from home," Porter said.

According to IDC, the home office phenomenon is now entering its third stage of development. For home office workers and the companies that can be their employers or customers, each stage has posed different opportunities and challenges.

Stage 1 - Dark Days of Downsizing: the 1980s
In the 1980s corporate restructuring prompted many to start their own home-based businesses as an alternative to traditional employment. While many of these home workers served as contractors to their previous employers, those still on the corporate payroll had even more work to do. A natural response by corporate survivors was to use an "after hours" home office to catch up on paperwork and keep pace with the increased work load.

Stage 2 - Business Building with PCs: the 1990s
The second stage of home office growth was in the 1990s as PC prices came down and a variety of home businesses were able to leverage technology. As IDC vice president Raymond Boggs noted, "Having a PC and advanced telephone services allowed the home business builders of the '90s to look like big companies to their customers and prospects."

Stage 3 - Work Everywhere: the 2000s
Online access to advanced capabilities will be changing the lives of both corporate home workers (daytime telecommuters and after hours workers) and those running a business from home on a full- or part-time basis. IDC expects by 2003 over 90% of home office PC households will have Internet access, and they will spend over $6.6 billion in total on Internet access. Remote capabilities and networking will be increasingly important as home office workers seek the same levels of mobile support enjoyed by their corporate cousins.

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