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  1. Technology
April 21, 1992


By CBR Staff Writer

What kind of market is there for computers that cost $10 each? If you believe the folklore that circulates around Palo Alto-based Echelon Corp, that was the question that started the company. The man who asked it was John Sculley, then head sales honcho at Pepsi Cola. The man that answered was Mike Markkula, the almost invisible co-founder of Apple Computer Inc who was scouting for a new chief for the Macmaker. During the courtship process, Markkula expounded his vision of the computer market, sketching out how profit could come either through manufacturing a few big, expensive computers, or through many cheaper ones. It was at that point that Sculley popped his question and, according to the story, that Markkula had his vision.


The founding of Echelon followed in 1988, by which time the vision had been honed into a practical product – a single chip that also contains input-output and its own network interface. The chip is the Neuron. The network is the Local Operating Network and Echelon has introduced its first control modules Neuron chips combined with interfaces for twisted pair or RS-485 cabling. You would think that a start-up company trying to tout a proprietary network technology in this day and age wouldn’t stand a chance. So the fact that Echelon Corp reckons that 200 companies from chicken coop climate controller manufacturers to photocopier designers are busily incorporating Local Operating Network – or LON – technology into their machines seems to indicate that it has something going for it. That something, as Markkula originally thought, is cost. At around $35 a piece for a module bought in bulk, the Neuron has won as customers for Echelon companies that realised that intelligent interconnection was required for their products, but either lacked the expertise to develop it, or started to develop the necessary technology but then discovered Echelon’s work and decided to move development to the Neuron chip. Echelon’s goal is to duplicate the ubiquitous success of microprocessors, which are found in everything from toasters to televisions to washing machines, but this time with added communications and at the moment it looks like the company is in with a chance. The European-funded Esprit Intelligent Home consortium displayed similar ideas last December, when it constructed a mock-up house containing televisions and heating systems that conformed to a standard Home Systems Specification.

Ever since Rolm Corp founder Kenneth Oshman handed in his cards to IBM Corp and diverted the Big Blue bucks he’d earned with the sale of his company to Armonk into a new venture to exploit an idea of Apple Computer cofounder Mike Markkula, we’ve followed the progress of that venture closely because it seemed to promise the same kind of revolution in the home and the industrial workplace as Ethernet has brought to the office. That company was of course Echelon Corp with its Local Operating Network, and it was in town the other day. Chris Rose went along to get progress report.

The standard was well defined, but behind the show home’s walls each of the intelligent devices was being controlled by personal computers – there was no silicon support, and there still isn’t. Barry Haaser, Echelon’s market relations manager is polite about the Esprit project, saying that it has done valuable work with high-level definitions. But, when asked whether he sees Esprit as a competitor, he simply holds up one of the Local Operating Network modules and asks how long it will take for the Esprit companies to get this far. Instead of going for international approval, his company has taken the alternative approach – get out there in the market with a cheap commodity and you will see just how worried manufacturers are about proprietary versus open standards. In fact, Haaser believes that the Neuron chip could become the basis for Esprit implementations, if combined with a transceiver that duplicates the consortium’s transmission standard. Then there is the vexed question of openness. Will the company publish or license its LO

N protocols? In answer, Haaser points out that the chips cost $10 a piece – so why would people bother re-inventing the wheel when they can buy one? Meanwhile, the extra $20m that Motorola Inc pumped into the company in January is being used for an ambitious roll-out programme – 20 new products are due to be launched this year.

100 beta test lifts

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Unconventionally, the company’s newly-published brochure already includes many of them – LON routers, for example as well as RF transceivers for running wireless LONs and other transceivers for passing LON information over AC power cables. Not only more products, but cheaper too. While a Neuron chip costs $10 today, its manufacturers – Motorola and Toshiba Corp – are working to re-engineer them with an eye to a $5 chip next year and $2.50 the year after that. Of Echelon’s claimed 200 developers, only a handful have made their plans public. Apart from Tru-Measur, a manufacturer of alcohol dispensing systems, and Potter Electric Signal Company, purveyors of fine fire alarms, all has been quiet since the initial pledges of support when the Neuron was first announced. Be warned – somewhere in the US there are 100 beta test lifts testing LON technology. Among the clues that Haaser is willing to dispense is the indication that at least one data communications company is building Local Operating Network chips into its hubs or file servers for network management purposes. The aim is to solve the age-old problem of how to manage a network component when management messages are being passed over the same failing link. Signals born over the mains current could be a winner for solving this conundrum. The result? A file server that shuts itself down when it learns that the system administrator is just coming down in the lift, having set fire to himself after drinking one creme de menthe too many.

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