E-Products, e-Manufacturing and e-Service are the goals of an enterprise to achieve. To achieve these goals, smart software and NetWare are needed to provide proactive maintenance capabilities such as performance degradation measurement, fault recovery, self-maintenance, and remote diagnostics. This paper reports the preliminary development of an Internet server controller based intelligent maintenance system for information appliance products (consumer appliances). The discussion also involves on how to develop products and manufacturing systems using Internet-based intelligent technologies and how to ensure product quality, coordinate activities, reduce costs and change maintenance practice from the breakdown reaction to prevention. In the paper, a hybrid intelligent approach using hardware and software agents (watchdog agent) is adopted. The server controller is web-enabled and its core is an embedded network model. The software agent is implemented through a package of Smart Prognostics Algorithms. The package consists of embedded computational prognostic algorithms including neural network based, time-series based, wavelet-based and hybrid joint time-frequency methods, etc. and a software toolbox for predicting degradation of devices and systems. The effectiveness of the proposed scheme is verified by developing a real system for the washing machine.