Patrick Lo and the Internet’s Last Few Feet

The internet has a last few feet. Somewhere between the grand promise of a connected world and the laptop on a kitchen table, there is a box, a cable, a wall and a person wondering why the signal has disappeared. Patrick Lo made a career in that distance. The NETGEAR co-founder dealt in the equipment that lets an ambitious idea become an ordinary activity: sending a file, joining a call, watching a film in the room you actually want to sit in.

It is an unusual place to look for a founder’s story. Routers seldom inspire affection. They receive attention chiefly when something goes wrong. Yet Lo spent 28 years at the company he started with Mark Merrill, following the internet from wired networks toward homes full of wireless devices. His own first connection to America involved a scholarship and a much smaller sum of capital.

The airfare came separately

Lo grew up in Hong Kong after leaving China as a child. He wanted to study electrical engineering in the United States. In 1976, he won a full scholarship to Brown University. He later described it as being “like winning the jackpot.” The prize still left a practical expense: getting to Rhode Island.

He raised $400 for the plane ticket. Years afterward, he would describe that fundraiser as his first experience raising capital. The detail belongs in his story because of its modest scale. A university had opened a door; somebody still had to pay for the journey through it.

After the cab ride on arrival in America, he had $170 left. He earned his engineering degree, returned to Hong Kong for work and joined Hewlett-Packard. HP eventually transferred him to Silicon Valley. His route to founding a California technology company included a return journey, a job and the time needed to learn a business.

An apprenticeship on both sides of the counter

From 1983 to 1995, Lo worked at Hewlett-Packard in the United States and Asia. His management roles covered sales, technical support, product management and marketing. That list gives the engineering degree some useful company. He had experience explaining a product, supporting it and deciding how to put it in front of a customer.

Those jobs sit at different points in the same transaction. The engineer can know what a device does. The salesperson discovers whether anybody will pay for it. Technical support hears what happened after the purchase. A networking business needs answers from each of them, preferably before the customer has exhausted their patience.

Lo later recalled proposing an internet-focused division at HP and encountering skepticism about the opportunity. He left. A former boss, Dominic Orr, supported his idea at Bay Networks. The proposition was straightforward: develop affordable networking hardware for consumers. It would eventually put Lo back into competition with the kind of company where he had learned his trade.

A company inside a company

NETGEAR began in 1996 with backing from Bay Networks. Lo and Merrill had room to run a distinct operation, with separate people and budgets, inside a larger business. That arrangement gave the young company a starting place. It also meant its future depended on decisions made elsewhere.

Nortel bought Bay Networks in 1998. Lo then worked to secure financing for NETGEAR’s independent future. The business had survived its difficult early years, but the owner’s priorities were another problem to solve. A promising market and an enthusiastic founder could not settle the question of who would control the company.

By 2003, NETGEAR was public. Lo found some amusement in the industry’s opposing directions. His company had worked to get out from under Bay Networks and Nortel, while rival Linksys had joined Cisco. He observed that “the grass is always greener.” It is a compact description of corporate strategy, and rather cheaper than a consultant.

The public listing changed the setting of the work. NETGEAR would now explain itself to investors as well as retailers, resellers and customers. Lo had become chairman and CEO in March 2002. The small networking operation was acquiring the obligations of an independent public company. In 2006, Lo received the Ernst & Young National Technology Entrepreneur of the Year award.

The people who plug it in

Lo’s explanation of the market was refreshingly specific. In a 2003 interview, he said that enterprise networking already had plenty of suppliers when NETGEAR was established. Smaller businesses had received less attention. He wanted technologies available to large companies to become accessible to smaller firms and homes.

The opportunity came with constraints. A small business needed reliability and security without the purchasing power of a large corporation. Lower prices would be useful only if the products did the job. Someone also had to help customers choose the equipment and install it.

That made resellers central to Lo’s account of the business. In 2003, 55 percent of NETGEAR’s revenue came from small businesses and 45 percent from retail channels. He described the customer service provided by value-added resellers as their essential contribution. It was a reminder that selling a box and delivering a working network are different stages of the same promise.

“The most valuable contribution of VARs is the service to their customers.”

Patrick Lo · 2003 interview

By its tenth anniversary, NETGEAR had 35,000 solution-provider partners worldwide. In 2006, Lo discussed wireless networking as a way for small businesses to carry voice, data backup, web services and video conferencing. He also wanted partners capable of understanding larger customers and their service requirements. The equipment could improve; the people around it had to grow with it.

The Uniqlo theory of networking

Lo could make these commercial calculations sound cheerful. During a 2015 interview in Japan, he smiled repeatedly, spoke energetically and joked about the market beyond the Fortune 500. He compared NETGEAR’s approach to Uniqlo: combine development, manufacturing scale and global selling to balance price with performance.

The clothing analogy was a good fit for a business trying to make useful technology broadly affordable. It put cost discipline and product development in the same conversation. A faster networking standard might attract attention, but a sensible price and an understandable product helped turn attention into a sale.

His international outlook had appeared early. NETGEAR entered Australia, Japan and Germany soon after its founding. In a 2008 discussion of the Australian operation, Lo emphasized its performance relative to population, market awareness and channel relationships. He was watching how the business worked in particular countries, rather than treating a global presence as a collection of flags on a slide.

More rooms, more things

As the internet spread through the home, Lo’s ambitions followed the devices using it. At CES in 2013, he argued that connected appliances and home automation should reach a much broader population. He spoke of a long-term goal of bringing that technology to 50 million to 100 million homes over ten to fifteen years. It was a stated ambition, with a substantial stretch of time attached.

In 2015, Arlo cameras gave that direction a tangible form. Lo described a connected-home ecosystem that could be accessed beyond the house through a computer or mobile browser. The networking company was selling something people could point at a doorway, rather than something they might tuck out of sight beside the modem.

Orbi followed in 2016, addressing whole-home wireless coverage with a tri-band mesh design. The idea met a familiar domestic complaint: the connection was available somewhere in the house, just inconveniently far from the person who needed it. Multiple units turned the layout of the home into part of the product problem.

The camera business eventually took its own path. Arlo went public in 2018, and NETGEAR completed the spin-off that December. A company founded to connect homes and small firms had helped create another public business. Its boundaries could change even while the original interest in connectivity remained recognizable.

The network becomes a service

Near the end of his tenure, Lo was discussing what customers expected after they had a connection. In a 2023 interview in Milan, he described users whose work, entertainment and financial transactions demanded more from a network. Speed and coverage belonged alongside latency, privacy and security.

He linked NETGEAR’s move into services to those uses: a confidential video conversation, a financial transaction, a game sensitive to delays. The business was extending beyond the initial hardware purchase. Customers would be asked to pay for services associated with the network they already owned.

That shift complicates the familiar image of a router company. The product still occupies a physical place in the house, but the commercial relationship can continue through software and subscriptions. Lo’s late interviews returned to the same practical test that ran through his earlier career: what does the customer want to accomplish with the connection?

Twenty-eight years, then a handover

The closing chapter included difficult numbers. NETGEAR’s 2023 revenue was $740.8 million, down 20.6 percent from the previous year. It recorded a GAAP operating loss of $33.3 million. Channel inventory reductions constrained sales. The familiar name on the equipment did not exempt the company from the problems of moving hardware through a competitive market.

There was also a developing services business: NETGEAR ended that year with 877,000 paid subscribers. The company Lo was leaving had both old distribution problems and newer sources of recurring revenue. A tidy victory lap would miss that combination.

On January 31, 2024, Lo retired as CEO and chairman. Charles, known as CJ, Prober became chief executive immediately. The board’s search had run over the preceding twelve months, and Lo remained for a limited strategic advisory transition through July.

After 28 years, the next decisions would belong to somebody else. Lo had spent his career asking how more people could use a connection: students, households, small businesses, customers with new devices and old walls. His own journey had required a scholarship, a plane ticket and help paying for it. The company he co-founded worked on the equipment for millions of other journeys, conducted from a desk or a kitchen table. The router could remain quietly in the corner. For its customer, that was the desirable ending.