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The drive will not update itself automatically. You will have to download the firmware update and update it yourself. You may also want to get the latest Manager software that is Windows 7 compatible.
Firmware Version 2.064:
Iomega Home Storage Manager (Windows)
The blue indicator light is the Drive Capacity LED - Displays drive capacity information without logging into the administration tool.
a) Off: Drive is below 70% full.
b) Flashing blue: Device busy. Drive Starting up or shutting down.
c) Solid blue: Warning! Drive is over 70% full.
d) Solid orange: Caution! Drive is over 85% full.
e) Flashing orange: Critical! Drive is over 95% full.
f) Alternating Blue/yellow: DHCP Server Unavailable. Your Home Media Network Hard Drive was not able to get an IP address. Check the network connections and router settings.
The white indicator light is the Status/Activity LED - Indicates the Home Media Drive's power and drive activity status.
a) Solid white: Drive powered up and ready.
b) Flashing white: Drive in use, transferring data (reading / writing).
c) Solid red: Drive not ready/Drive Failure.
d) Alternating white/red: Boot device not found.
i have just bought one and the blue light signifies its on (it flashes) when the pen is in range it turns solid blue and when contact is achieved it turns off. i had the problem above until i installed the drivers from the website and restarted it let the computer install the devices and plug it in . after this it all worked coll hope this helps.
The next step that I would recommend is to use the Admin Tools in the
Control Panel and select Event Viewer. Check out each of the three logs
and see which one has an event with the red X at the time of the
shutdown. High light it, and you should be able to see what program, if
any, caused the problem.
That should give you more information that may be more specific and help
you track down the actual culprit.