Struggling Netgear Tries To Sting Consumers $2,799 For W6 Router
Struggling networking Company Netgear whose sales are down over 33% in the last quarter has launched an expensive new Orbi Quad Band Mesh Wi-Fi System (RBKE960 Series) router which, with two extenders will cost you $2,799.
The US business reported dismal first-quarter 2022 results, with earnings and revenues declining on a year-over-year basis
The big question now is whether consumers will pay this much for a W6 router when you can get D Link W6 router with two extenders for under $400 that do a pretty good job.
With NBN peeking out at a maximum of $150Mb per second download speeds, and most households only getting up to 100Mps most households moving to cheaper W6 routers than what Netgear are offering, are finding that more devices can be attached to a W6 network than in the past.
The Netgear Wi-Fi 6E has a 6GHz band that takes care of home laptops, TV streaming while the 5GHz band connect other devices with the 2.4GHz band designed to connect smart lights and security cameras.
I am currently running two W6 routers a D Link and a fully imported ARRIS Surfboard device and both are capable of delivering multiple device connectivity at over 100Mbs
Netgear claims the justification for paying the staggering amount for a router is a second 5GHz band that is used as a dedicated backhaul channel – technology pioneered by Netgear – so data can be exchanged between the router and the satellites around your home without affecting the performance of the connected devices on your network.
A Netgear spokesperson claimed that “From the moment multi-Gigabit Internet enters your home through our 10 Gb Ethernet port, to our quad-band architecture, 2.5 Gigabit LAN ports and improved 5GHz performance all the way down to your latest Wi-Fi 6E devices, there’s not a single bottleneck in this system” They forgot to mention that the maximum NBN speed in Australia is 150Mbs.
“Our new Orbi Quad-band WIFI 6E Mesh System delivers top-of-the-line performance for not only today’s needs, but also for the future requirements of even the most demanding and sophisticated smart homes.”
During the past 12 months Netgear stock has fallen over 57% as the US Company tries to grow their share of the premium networking market, revenues fell over 33% in the last quarter.
Seeking Alpha, Analysts claim that demand for high-priced network gear is weakening and is tipped to fall even further as consumers cut spending due to inflation and rising costs.
Observers claim that inflation is hurting consumers while supply constraints limiting output with Companies such as Netgear struggling to grow market share.
In the first quarter of 2022, Netgear reported non-GAAP earnings per share loss of A$13.3 million.
Revenue fell by 33.8% to US$210.56 million.
PAC (the Asia Pacific Region) revenues (14%) were down 22.9% to $29 million.
The Company has not said how much sales are down in Australia with local marketing manager Sarah Dalli not returning calls.
Chief Executive Officer Patrick Lo said that the company experienced ongoing strong demand for its SMB products like its ProAV switches.
Netgear’s home products accounted for 62% of total revenue, compared to 38% for business products such as the Companies ProAV switches.
Growth for Netgear’s Orbi 8 and Orbi 9 continued, to be offset by a contraction in the global consumer WiFi market.
To offset higher component costs, the company selectively raised prices in the last quarter with the US business admitting that more cost rises are due this quarter.
It will do so again for some of its SMB products at this time.
New B2B product sales accounted for 26% of Netgear’s Q1 shipments.