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Internet Finding Few Newcomers in 2006

For Immediate Release
Contact: Jenny Barrett or Chelsey Tyson
Parks Associates
972-490-1113

Internet Finding Few Newcomers in 2006
Study finds substantial barriers exist to luring late adopters to the Internet;
14 million households rely on Internet connections outside the home

Dallas, TX Feb 23 -- A new study from Parks Associates has found few new households willing to subscribe to Internet services, which will limit 2006 growth in overall Internet penetration to one percent, rising from 63% to 64% by year's end. According to The National Technology Scan (2005), a survey of 1,000 U.S. homes, there are currently 39 million homes without Internet access, and among these, only eight million own a computer, an obvious prerequisite for Internet adoption. Moreover, the majority of these PC households will not subscribe to an Internet service at any cost.

The study found only two million offline homes are planning to get Internet services in 2006. Another 300,000 homes said they might subscribe if offered a cheaper service. At the same time, 14 million U.S. households do not have Internet service at home but access the Web at work or other locations, such as a library or an Internet café.

"We are clearly facing a problem of demand, not supply," said John Barrett, director of research at Parks Associates. "Computers and Internet service have never been cheaper, yet many households still show little enthusiasm for the technology."

Reasons given for this lack of interest vary. Among households that will not subscribe to an Internet service at any price, 31% said having access at work is sufficient for their Internet needs. Another 18% simply claimed, "I am not interested in anything on the Internet." Thirty-nine percent of households cited "other" reasons for their lack of interest. "We present them with several possible reasons, and their response is typically none of the above,'" Barrett said.

The National Technology Scan (2005) is a nationwide survey that provides an accurate picture of current adoption levels, demand, and the size of the total available market. Such data are crucial for strategic planning and forecasting sales and revenues for product lines and services. For more information on The National Technology Scan (2005), visit www.parksassociates.com or contact Parks Associates at 972-490-1113.

About Parks Associates
Parks Associates is a market research and consulting firm focused on all product and service segments that are "digital" or provide connectivity within the home. The company's expertise includes home networks, digital entertainment, consumer electronics, broadband and Internet services, and home systems.

Founded in 1986, Parks Associates creates research capital for companies ranging from Fortune 500 to small start-ups through market reports, multiclient studies, consumer research, workshops, and custom-tailored client solutions. Parks Associates also hosts Fall Focus and co-hosts CONNECTIONS™ (in partnership with the Consumer Electronics Association) each year. www.parksassociates.com