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Intel readies phone-based networking

Intel will introduce technology that allows multiple PCs to interact via a phoneline-based network and share a single a Net connection.

PALO ALTO--Computer chip giant Intel will introduce hardware and software technology this spring that will allow multiple home PCs to interact on a telephone line-based network and share a single connection to the Internet.

The combined product will consist of a networking card and associated software to facilitate the setup. Working in conjunction with the networking features built into Microsoft?s Windows 95 and 98 consumer operating systems, the product will be able to communicate in a peer-to-peer fashion without the need for a so-called hub, according to Intel.

The technology, based on an emerging standard for tying PCs together using existing phone wire, represents Intel?s first direct stab at the home networking market, expected to gain steam through the year and the subject of a symposium here. It is based, in part, on a recently developed chip made specifically for phoneline-based network usage. The chip is expected to ship in volume next month.

Analysts said Intel's move will only feed the company?s core goal of selling more PCs based on its processors. With the price for a low-end PC continuing to fall, homes with multiple computers are expected to grow as a percentage of overall computer penetration, according to projections.

"It?s a natural manifestation of [Intel?s] computer strategy," noted Boyd Peterson, director of the consumer market convergence practice for industry researcher the Yankee Group.

While Intel is highly successful in the processor market, it needs to enter new markets to sustain its high-growth path, Peterson said. Uses for Intel?s forthcoming home networking technology include everything from multiplayer gaming and videoconferencing to shared Net access and, potentially, baby monitoring with the use of a camera peripheral.

Intel will not alienate its traditional partners, such as PC vendors, according to Peterson. "It?s unique for Intel to focus on a different market in the sales process," he said, alluding to the expected direct consumer thrust associated with the home networking rollout.

Intel executives said the forthcoming line of products is currently undergoing tests. The final product will cost about $100 per PC, according to the company.

"We think this is the first technology that meets the needs of the consumer," said Dan Sweeney, general manager of Intel?s home networking operation. "The phoneline technology is going to be very affordable."

Running at 1 megabit per second (1 mbps), the phoneline technology will work well with up to three PCs connected to it. Intel stressed that other peripherals, such as printers and digital cameras, could also be connected to the network.

Other companies are working on similar variations for machines from Apple Computer.

Competitors in the nascent market are expected to include the likes of networking giant 3Com and chip maker Advanced Micro Devices. There are also slew of start-ups taking advantage of the recently developed home networking standard, several of whom are part of the Home Phoneline Networking Alliance standards group.

Intel said it would sell its home networking technology through three channels: retail, online, and PC hardware partners.