Free for all, Robotics pushes x2 growth with incentive campaign

U.S. Robotics pledged free upgrades last week to both end user and Internet service provider buyers of its 56 kb/s "x2" technology when the final standard is ready. If that's not enough to get the market moving, Robotics is also throwing in one month's free Internet access up to $25 and a 30-day money-back guarantee on all its x2 modems in its new "x2 Delivers" campaign.

U.S. Robotics, which was first out with its x2 technology, has about 100,000 installed ports in 350 different ISPs, with 700 more ISPs committed to using the technology, officials said. Opposite them are the K56flex backers, including Rockwell, Lucent Technologies, Ascend Communications and Motorola, whose modem makers have been shipping product for about two months.

The competition has been waging a "confusion campaign" about the emerging standard in an attempt to slow down the market, so they can catch up with Robotics, said Casey Cowell, U.S. Robotics' chairman and chief executive officer.

A single 56 kb/s standard is expected to be released by the beginning of 1998, and Cowell said a draft that will be "x2 or very, very similar" may be ready by September. Robotics officials are confident the upgrade to the eventual standard will be a simple software upgrade to its Texas Instruments' digital signal processing-based modems.

Lisa Pelgrim, analyst with Dataquest, San Jose, agreed about a simple software upgrade on the DSPs but pointed out that it's likely both sides will be able to do that. The real key is U.S. Robotics' $25 rebate, she said.

"A rebate makes their ISPs happy and shows them how much Robotics wants to work with them and how committed they are to those ISPs," Pelgrim said. "Robotics is using its muscle in the consumer market to help drive the ISP market, and showing ISPs that Robotics will be a good corporate partner.

A side benefit is that Robotics will handle the rebate, so ISPs aren't bothered with the hassle, she said.