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Net appliances too costly

Price tags could scupper Web devices

Internet appliances, the much-hyped portable devices designed to be a low-cost alternative to PCs, will finally be in the shops early next year. But they could prove too expensive.

Ericsson’s Screen Phone and 3Com’s Audrey (really), will be the first to come out. Similar devices are being manufactured by Compaq, Pace, IBM and Sony.

The devices, consisting of a simple box and often a touch screen, are designed to give web and e-mail access with maximum ease of use without the complexity and expense of buying a PC.

But according to research by IDC, the amount of web tablets shipped won’t reach 1m units worldwide a year until 2004. Jason Armitage, senior research analyst at IDC, said there simply aren’t enough compelling reasons to buy one of these devices, especially the pricey Sony Airpad.

“At present it’s difficult to see how this product is going to move from a niche market of early adopters to a mass market that would help to bring the price down.” The Audrey is due to go on sale for $500 in the US, a price that can get you a reasonable PC. Sony’s Airpad will sell for $1,200, which makes it even less attractive.

Nick Ruczaj, UK business manager for 3Com, said the company is looking at a number of ways of selling the Audrey. But 3Com hasn’t pinned down how to sell the product it’s made yet. Options could include selling the products at a discount when signing up for an ISP, or home shopping service. 3Com are talking to a number of interested parties.

Armitage at IDC still isn’t convinced. Even if consumers would get the device for less, he points out “that might be a way round the high price but the provider would have to take the price hit”.

“Until there’s a strong application for these devices, it’s difficult to see how internet appliances would transfer into the mass market.”

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