AMI-Partners: U.S. Home-Based Business Market--A Sleeping Giant.

Offers $52 Billion Market for IT and Telecom Vendors

Provides Potential Silver Lining Amidst Talk of Recession

NEW YORK -- With the U.S. economy teetering on a possible recession, one silver lining for the upcoming buying season is likely to come from an unexpected source: the tech-purchasing power of U.S. home-based businesses.

According to a recent global study by AMI-Partners, a leading consulting and research firm, spending on IT and telecom products and services by U.S. home-based businesses (HBBs) is expected to reach approximately $52 billion. "The home-based business is rapidly becoming a significant sector that vendors need to pay attention to," says Antara Jaitly, Senior Analyst at AMI. "More people may look to operating a home-based business as a means to supplement their income or fulfill personal aspirations."

According to Jaitly, "The approximately 15 million PC-owning U.S. HBBs are expected to drive $32.7 billion in IT spending during 2007 with a projected increase to around $35 billion in 2008 and $19 billion in telecom-related spending in 2007 which is forecasted to increase to $19.5 during 2008."

Says Robert Takacs, Vice President at AMI, "These HBBs plan to spend on a wide array of hardware, software and telecom-related products and services ranging from PDAs and smart phones to PCs, printers, software applications, security and storage products and high-speed broadband services." Vendors such as HP, Microsoft and Dell resonate well with these HBB owners. Google scored high marks in online services. Among retailers Best Buy, Staples and Office Depot/Max were mentioned by those utilizing the retail outlet for PC purchases. Almost 1 out of 4 HBBs buy their PCs directly from the manufacturer.

The U.S. HBB market has exploded with service-oriented businesses. The Internet has played a pivotal role, spurring an increase in the use of websites and Internet-based electronic marketplaces such as eBay, which have enabled small service-focused businesses - as varied as consulting, staffing, travel, and catering - to flourish.

Who is the Home-Based Business Owner?

Interestingly, the AMI study reveals that the average U.S. HBB is highly educated, with over 3 in 5 having at least a college undergraduate degree. These HBB owners are typically in their late forties, having been in business for about 7 years. Over 4 in 10 mentioned that their HBB attributed to more than half of their total annual household income. "With median HBB annual revenues equaling $62,000, HBB revenues are 30% more affluent than the median U.S. household income of $48,200," says Jaitly.

According to Takacs, "Another noteworthy finding is that a majority of HBBs were started as a result of lifestyle choices. We see four distinct formation kernels driving HBB creation. These reflect the mindset of the founder, define HBB growth goals and illuminate distinct IT spending choices. There is a distinct HBB psyche which is a synthesis of the owner profile, buying power and formation drivers. For marketers, understanding this psyche is critical to effectively targeting this segment."

The groundbreaking global HBB study was conducted over several thousand households across countries in North America, Latin America, Europe and Asia-Pacific regions. The study complements AMI's long-standing coverage of the Global SMB market and provides actionable tactical and strategic insights for successfully targeting the HBB market - encompassing current adoption and future plans, attitudes, drivers, buying behavior, purchase outlets, market segmentation and related factors.

About Access Markets International (AMI) Partners, Inc.

AMI-Partners specializes in IT, Internet, telecommunications and business services strategy, venture capital, and actionable market intelligence--with a strong focus on global small and medium businesses (SMBs), and extending into large enterprises and home-based businesses. The AMI-Partners mission is to empower clients for success with the highest quality data, business strategy perspectives and "go-to-market" solutions. Led by Andy Bose, the firm has built a world-class management team with deep experience cutting across IT, telecommunications and business services sectors in established and emerging markets.

AMI-Partners has helped shape the go-to-market SMB strategies of more than 150 leading IT, Internet, telecommunications and business services companies over the last ten years. The firm is well known for its IT and Internet adoption-based segmentation of the SMB markets; its annual retainership services based on global SMB tracking surveys in more than 25 countries; and its proprietary database of SMBs and SMB channel partners in the Americas, Europe and Asia-Pacific. The firm invests significantly in collecting survey-based information from several thousand SMBs annually, and is considered the premier source for global SMB trends and analysis.