In the first step toward positioning itself as a manufacturer of full solutions as opposed to stand-alone products, Linksys is establishing a home networking division that will focus on the interoperability of products in its increasingly diverse line card.

 Chris Stevens, a founder of CEDIA, will lead the yet-to-be-named business unit. Linksys, he says, realises the future of the home network lies in connecting devices to each other and the Internet as consumers look for more ways to distribute, share and view content across that network. “If we get this done right, all of that connectivity will exist in the background,” Stevens says. “What will be apparent, however, is a much richer user experience.” This approach facilitates the delivery of content that’s owned and created by the end user, as well as commercial content, he adds.

The first product coming out of the division will be the DP-600, a network-connected DVD player from Linksys’ acquisition of Danish vendor KiSS last year. The DP-600 plays high-definition Windows Media video files, connects through Ethernet to the home network and to the Internet through a Wi-Fi connection, and enables users to access an online program guide and radio station directory. Linksys plans to launch that product domestically in the next few months.

> . . . ‘There will be specific products tailored to the installation channel that will enable integrators to realize profit opportunities.’ –Chris Stevens, leader of yet-to-be-named new Linksys unit

Many industry leaders say consumers have been slow to adopt networked entertainment gear because the products, which vendors promote as “plug-and-play,” are far from it. Most are difficult to set up and difficult to use. Integrators and analysts say vendors would sell more products, increase customer satisfaction and decrease the amount of product returns if those products are sold as part of a full solution and implemented by a professional integrator.

“People are frustrated with this category because of the difficulty of getting stuff installed,” says Gordon van Zuiden, president of CyberManor, a Los Gatos, Calif.-based home integrator. “Our experience has been that unless these products have stable OSes, IP-based products aren’t always a good fit for the home.” However, because KiSS products such as the DP-600 are Linux-based, they should provide a more stable user experience, he says. Copyright issues also have slowed the growth of the networked entertainment market, integrators say.

“It’s one thing to move content around the home, and quite another to move high-definition video,” van Zuiden says. As a result, home users could end up with a “mishmash solution” of high-definition video that can only be watched in certain areas of the home because it’s locked to a specific box through digital rights management, he says.

Linksys expects to officially announce products and a channel program, initially aimed at CEDIA members, for the networked entertainment business unit later this year. IP telephony, entertainment and security products will be the initial focus and Linksys plans to leverage its existing expertise in these areas.

“It’s fundamentally important for us that everything will be IP-based,” he says. “Although we haven’t figured out exactly which technologies we will incorporate for the home integrator channel specifically, our intention is to provide a complete solution.”

Allen Powell, director of channel sales at Linksys, will be involved in the development of the new group’s channel strategy. “Allen’s background is as a VAR, and CEDIA integrators have the same issues,” Stevens says. “That’s why Allen will be a terrific person for developing a channel strategy that’s profitable for the CEDIA channel.”

Elements of the program will be designed for custom A/V installers and integrators, as well as distributors. “We need a certain amount of momentum that some of the product going through wide distribution will provide, but there will be specific products tailored to the installation channel that will enable integrators to realize profit opportunities,” Stevens says.

Home monitoring and control will be the next push Linksys makes in the home. Wireless cameras will be the first offering in that product line, Stevens says. Cisco Systems’ January acquisition of Zensys, maker of the Z-Wave wireless home control solution, gives Linksys significant inroads into this market.