SOHOware Broadband Internet Gateway Brings Home Networking Business Strategies Into Focus for Service Providers

Business Wire, April 4, 2000

Business Editors and High-Tech Writers

SANTA CLARA, Calif.--(BUSINESS WIRE)--April 4, 2000

Residential Gateway Offers Greater Depth to MSO-Customer

Relationships; Designed With Flexibility For Easy

Customization And Operation

While residential gateway products are key elements of home networking solutions for consumers, they are also viewed as defining MSO business strategies as MSOs compete for a larger share of the high-speed Internet access market.

There is no mystery to what residential gateways do - they route multimedia traffic from a cable modem or ADSL service to multiple destinations in the home. But there are a number of different vendor solutions available and their differences say a lot about MSO visions of today's broadband market, where it's going and how it fits in to long-term relationships with customers.

"Working with MSOs has enhanced our perception of home networking business strategies," said Andy Chang, vice president, business development at SOHOware Inc. (formerly NDC Communications), which markets the SOHOware(R) brand of home networking products. "The convenience-engineered SOHOware brand is synonymous with consumer-friendly features, and we have added a new layer to our business model that requires being MSO-friendly at the same time."

As a result, the SOHOware Broadband Internet Gateway (BIG), announced late last year, could well be the first product conceptually designed by MSOs for the broadband market. Among its MSO-oriented benefits are:

-- Isolation of in-home multiple user IP traffic from the MSO

backbone,

-- Firewall Internet security,

-- Plug-and-play installation, and

-- Value-added features including parental control over web

surfing practices of minors, support for up to 4 IP addresses and

a gaming zone which allows easy access to multi-player online

games/services.

In tailoring its products to the MSO business, Chang says the driving forces are creation of new revenue opportunities, controlling costs commensurate with revenues, initial customer satisfaction, building customer loyalty (and repeat business) by offering a complete product line, and bundling SOHOware products with MSO services for custom solutions.

The SOHOware Broadband Internet Gateway is a natural fit for the home networking market and it makes sense for MSOs to offer this type of broadband networking," said Karuna Uppal, senior analyst, consumer market convergence, The Yankee Group. "SOHOware's experience in the networking market, along with their MSO partnership business model, will be beneficial to them in this rapidly growing broadband space."

The initial appeal of broadband technology is access speed and the ability to handle large volumes of data, but when it comes to how consumers will use this resource, MSOs face their customers one at a time. Applications range from entertainment to school work, e-mail, shopping, telecommuting, home-based businesses, and many combinations of these.

The residential gateway comes into play anytime applications involve two or more PCs concurrently online. It enables sharing one IP account, and while MSOs may charge a fee for multiple users, it is less than the cost of individual accounts for each user. "Consumers get a bargain and MSOs get incremental income," Chang said.

SOHOware BIG features a built-in Ethernet hub for physical connectivity of multiple PCs and embedded Network Address Translation (NAT) that translates a private set of IP addresses into a single public IP address. It acts as a DHCP server by automatically allocating a dynamic IP address to each connected device. NAT also functions as a firewall to protect the home network from intruders. Another SOHOware product - called NetBlaster - enables wireless connectivity.

Plug-and-play installation uses the resources of Microsoft Windows, which only requires the user to select a protocol (TCP/IP) via the control panel facility. Configuring SOHOware BIG is equally simple and requires only the entry of passwords. An Internet service provider may require additional information.

To engage the parental control feature, a user clicks on a prompt and enters a list of web sites that may be accessed. Another prompt allows a view of 100 web sites previously visited by each user on the home network.

"MSOs are venturing into the home networking market for the first time, and they are very concerned about doing it right," Chang said. "Obviously, they want the best quality in products, distribution and technical support, but within a longer-term value-added strategy, they also want customer loyalty and recognition for service innovations."

That's one reason why established brands with high consumer ratings are important, in Chang's opinion. A good measure of trust and loyalty are already associated with the products, which is a good starting point. Newer broadband products like the residential gateway present another set of issues, however. Earlier home networking products have enabled peripheral sharing, file sharing and interactive gaming, for example, but the residential gateway is a statement of commitment to a full-fledged local area network.