What happened to ARCnet

ARCnet was the first commercially available local area network standard, beating both Ethernet and Token Ring to market. Conceptually, it had similarities with both, and because it was inexpensive and efficient, it was popular for a good 15 years or so. ARCnet was an abbreviation for Attached Resource Computer NETwork.

ARCnet’s emergence and early lead

ARCnet was invented by Datapoint, the company that arguably accidentally invented the desktop computer and the microprocessor and the direct ancestor of the Intel x86 architecture. That’s a whole other story, but it raises even more might-have-been questions. ARCnet hit the market in 1977. Ethernet, although invented in 1973, didn’t become commercially available until 1980.

Datapoint invented ARCnet as a method to network together its computers in a way to allow them to share expensive 8-inch floppy drives. The modern OSI model didn’t exist yet, but conceptually, it worked like a modern network. And when the OSI model was invented, it took well to it.

As other types of computers became popular, ARCnet interfaces became available for them as well. And ARCnet’s early success turned Datapoint into a Fortune 500 company.

ARCnet vs Ethernet

The wiring topology was somewhat different from Ethernet, which made it cheaper and less finicky. It was more versatile too, supporting bus, star, and distributed star topologies. Besides the wiring being less expensive, the interface cards were less expensive than Ethernet too. A Dec 4, 1989 article in Network World said ARCnet cards cost 30-60 percent less than Ethernet cards did.

The catch was that ARCnet operated at 2.5 megabits per second, and that lagged Token Ring’s 4-megabit speed and Ethernet’s 10-megabit speed. The difference was that ARCnet didn’t have collisions. Conceptually, it was similar to Token Ring, where the network passed a token from machine to machine on the network, and no machine could speak until it had the token. This eliminated the dreaded problem of collision.

A collision was when two machines listened on the network, saw no traffic, and tried to send traffic at the same time. When that happened, they each had to pause and try again.

On paper, Ethernet was theoretically four times as fast as ARCnet and 2.5 times as fast as Token Ring. But collisions meant that advantage was purely theoretical. The increased overhead of dealing with collisions meant ARCnet and Ethernet ran at about the same speed, especially on early PCs that ran at 10 MHz or slower.

But from a marketing standpoint, Ethernet’s 10 megabit speed gave it the advantage. If you weren’t a network engineer, you perceived Ethernet as faster and better, period.

The problem for ARCnet was that as time moved on, faster processors could process collisions much faster. From what I was able to gather, the tipping point came at around a 20-25 MHz 386. On that class of a machine or better, Ethernet was faster. So even though ARCnet had the early lead, its sales didn’t grow as quickly as Ethernet or even Token Ring as the 1980s moved on. By 1988, Ethernet overtook it in market share.

What happened with ARCnet Plus

Datapoint announced a faster 20-megabit version of ARCnet, called ARCnet Plus in 1989. But its release slipped multiple times, finally appearing on the market in February 1992. The delay led some impatient customers to switch to Ethernet or Token Ring. Not only was it late, but it was expensive. The Oct 5, 1992 issue of Computerworld noted a 20-megabit ARCnet card cost $995, versus $120 for a 4-megabit ARCnet card or $175 for a 10-megabit Ethernet card. So you paid five times as much for what appeared to be double the performance of Ethernet.

If it had had arrived on time and at a more competitive price, ARCnet Plus might have helped ARCnet regain the lead. At best, it was too little, too late. More likely, it drove people to switch to Ethernet. Ethernet was cheaper, and by 1992, word was out that 100-megabit Ethernet was on its way. If you were going to switch, you might as well switch to Ethernet so you could be ready for the newer, faster version, which arrived in 1995.

And Ethernet didn’t stand still. Gigabit Ethernet wasn’t far behind, arriving in 1998. And as all of this was going on in the early 90s, CAT5 wiring and switches came to Ethernet, making the cabling less finicky and almost eliminating collisions.

By the mid 1990s, ARCnet had fallen by the wayside as a mainstream networking technology. The problem for ARCnet was that as its technological advantages eroded away, its cost advantage also eroded away.

ARCnet today

ARCnet still exists in certain industrial applications, especially factory floors. In factories, lifecycles for equipment tend to be measured in decades rather than years. That means ARCnet equipment does still exist and is still being manufactured. It’s just a niche technology now, not existing in the types of volumes that Ethernet has. But as someone who started my career in a Token Ring shop, I’ve gone from seeing more Token Ring than ARCnet to the other way around.

What might have been

It’s fun to imagine what might have happened if Datapoint had realized the full value of what they had. And it is potentially less of a stretch to imagine ARCnet faring better. The turning point seems to have been around the time of the Novell NE2000 network card. It was a minimum-viable-product Ethernet card, but Novell designed it to be cheap so they could sell more network software, and they encouraged others to clone it. This economy of scale allowed Ethernet to come much closer to meeting ARCnet’s price, and later to overcome it.

By 1988, Ethernet was the leading network topology, with ARCnet in second place, according to a May 30, 1988 article in Infoworld written by Mark Stephens.

The NE2000 became possible when National Semiconductor released an inexpensive Ethernet chipset. If National Semiconductor or another major chip maker at the time had released a disruptively inexpensive ARCnet chipset around that time, it’s possible Novell would have gone that direction instead. Of course Novell went by the wayside soon after ARCnet, but one of the reasons Windows was able to take over as the dominant network operating system was because it supported all of the same hardware Netware supported.

Dave Farquhar

David Farquhar is a computer security professional, entrepreneur, and author. He has written professionally about computers since 1991, so he was writing about retro computers when they were still new. He has been working in IT professionally since 1994 and has specialized in vulnerability management since 2013. He holds Security+ and CISSP certifications. Today he blogs five times a week, mostly about retro computers and retro gaming covering the time period from 1975 to 2000.