It is being anticipated that network computers would soon become more popular than personal computers because they would be less complex, less expensive, smaller in size, and easier to  use. Thus the concept of Internet appliance as stand-alone appliance has come into existence.

An Internet appliance is being referred to as a simplified desktop machine used primarily for accessing Web pages and programs. Internet appliances have been conceived as simpler cousins of the personal computers (PC) with no hard drive and a minimal operating system that permits almost instant boot up. Users could access their applications, such as e-mail and appointment calendars via a Web browser.

There are three main types of Internet appliances.

1. Set-top boxes - This appliance make use of a television screen for display purposes.

WebTV is the most prominent example of a set-top box and the first appliance to gain popularity. The set-top box that worked with a remote control and optional keyboard, allowed Web surfing, sending and receiving e-mail, and Real Audio streaming-media transmission.

2. Stand-alone terminals - These terminals come with a CRT or now popular LCD screen

Compaq's iPAQ IA-1 has a 10.1 inch LCD display, four universal serial bus ports, and a wireless keyboard. The IA-2 has a 15 inch CRT display and two USB ports. Both run the MSN companion OS and have flash RAM for storing OS updates. Sony's eVilla has a vertically oriented 15-inch monitor, a reader for its Memory Stick storage system, and two USB ports for peripherals such as a Zip drive or printer.

3. Web tablets - These flat devices come with an LCD touch screen, which functions like a mouse, integrated into the device.

Gateway's Connected Touch Pad has a wireless keyboard, speakers, a microphone and two USB ports.

Some industry observers say most of today's Internet appliances do not have a bright future because too many vendors are competing for a small market. Others believe that as the Internet continues to play an increasingly important role in our lives, Internet appliances will become more popular. The ability to access personalized, relevant information quickly and effortlessly is important to the success of these devices.

Some feel that there should be a robust platform that will support many applications such as home entertainment, games and multimedia screaming. Applications such as a mechanism for controlling household utilities and devices via the Internet could help drive the appliance market. Internet appliances could also become extensions to personal computers, on which users could view PC-based content anywhere in a house, not just on the personal computer. Appliance venders must make it easier to upgrade appliances.

In the long run, appliances have more potential for single- or special-purpose uses in educational, hospitality, and healthcare settings, not in the home, which has been the primary target market so far. Appliances will become popular as soon as more applications become available over the Internet.

It is being observed that Internet appliances have not been doing well in the market. There are various reasons for this downward trend. Internet appliances are not cost-effective, lack of value proposition, features and services and finally total lack of integration with other devices such as PCs,  home networks or broadband connections. Once these issues get sorted out, then Internet appliance market will steadily grow and they will be looked on favorably by consumers.