During the PC era, the nexus of info-tech innovation was business, especially in the office. As we enter “the post-PC era,” the nexus of innovation is shifting to the consumer, especially in the home. And this digital home
is where most technological innovation will occur over the next five years in the $101 billion consumer electronics industry.

Traditional industry boundaries no longer characterize hardware, software, and service providers to the digital home. For example, consumer electronic giants Sony, Philips, Panasonic, Sharp, Samsung, and Toshiba are adding greater processing power, memory, and Internet connectivity to their devices — in other words, they’re invading traditional PC territory.

Home automation companies like Honeywell and Rockwell are adding broadband access and wireless networking — traditional telecom territory — to their security, heating, cooling, and lighting systems.

One of Apple’s hottest products is the iPod, a music device more characteristic of a consumer electronics company than a personal computer firm. Each day, it becomes less clear which markets these
companies are targeting.

In fact, today’s household electronics market includes increasingly cross-functional and inter-connected home devices. This inter-connectivity requires an integrated communications network across the home. Unfortunately, most consumers already have difficulty connecting home electronics. Since the average American household has more and more video, audio, cable, phone, and computer devices located in different rooms, it is critical that these machines work together.

In view of this, Sony, Samsung, Philips, Nokia, and HP recently formed the Digital Home Working Group to develop and implement standards so devices can interconnect automatically via the Net. Sensing this shift, a number of players in the market have changed product strategies to begin offering integrated home solutions.

Unsurprisingly, the shift of technological innovation to the home means that women will be the driving force in many of these purchases. Today, almost a third of women consider themselves “early adopters” of technology. Women are involved in three of every four electronics purchases, according to the research firm Rockbridge Associates. Radio Shack reports that the percentage of its customers who are...