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The July 26, 2006 Issue Provided by System Dynamics Inc.
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More Ways To Confuse The Consumer

We live in a wonderful world of technology. More consumers than ever have broadband and lots have some flavor of home networking. But the cycles of innovation, coming at us ever faster, create points of instability where it's nearly impossible for the consumer to figure out what they are really buying. Back in April 2001, we wrote Top Ten Ways to Confuse the Consumer about how the home networking market was at one of those points.

Some of this month's home networking announcements suggest that we are once again at a similar point of instability. One announcement, coming from Broadcom, promoted the fact that they had "achieved the milestone of over one million 802.11n chipsets shipped in less than four months."

That's great for people who understand what they are and are not buying. However, as we wrote last month, product testers report that current devices based on Marvell chips will not interoperate with devices based on Broadcom or Atheros chips--they fall back to 802.11g. Netgear makes two nearly-identical products using chips from Broadcom and Marvell--but in the fine print they promise interoperability at full speed only with devices based on the same chips. It seems unlikely that a consumer will read the fine print--or understand what it means if they do.

Now Netgear is creating similar confusion in the powerline networking world. They recently launched a "200 Mbps Powerline HD Ethernet Adapter and Kit" and promote this product for enabling high quality HD video and audio streaming and for gaming. Consumers are very unlikely to realize that this product is based on the DS2 technology, which is not interoperable with HomePlug. If the user has previously installed any HomePlug products, the new Netgear product will not operate with them.

Netgear HDXB101 200 Mbps based on DS2 --> Click for larger pictureNetgear XE104 85 Mbps based on HomePlug turbo --> Click for larger pictureThe new "200 Mbps" HDXB101 based on DS2 (shown on the left) looks almost identical to the "85 Mbps" XE104 based on Intellon HomePlug turbo (shown on the right), which might reaonably lead a consumer to think that the products are compatible. Netgear's website says "easily coexists with NETGEAR's Wall-Plugged or HomePlug compatible products". Later the fine print says "may coexist with HomePlug 1.0 products but it is not compatible or interoperable with" them. We know of two sophisticated readers who ordered these units assuming that "coexists with" implied "interoperates with".

We understand the desire of networking vendors to "one up" each other, and we're not implying that any of these products are inferior. But we're concerned that reasonable customer expectations for compatibility may not be satisfied and will likely result in negative press comments until the confusion is resolved.

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