Marketing deceptions. The term is mainstream in this general sense. Among hackers it's strongly associated with bogus demos and crocked benchmarks (see also MIPS, machoflops). "They claim their new box cranks 50 MIPS for under $5000, but didn't specify the instruction mix - sounds like smoke and mirrors to me." The phrase has been said to derive from carnie slang for magic acts and "freak show" displays that depend on "trompe l"oeil' effects, but also calls to mind the fierce Aztec god Tezcatlipoca (lit. "Smoking Mirror") for whom the hearts of huge numbers of human sacrificial victims were regularly cut out. Upon hearing about a rigged demo or yet another round of fantasy-based marketing promises, hackers often feel analogously disheartened.
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Nearby terms: SMM « SMNP « smoke « smoke and mirrors » smoke-emitting diode » smoke test » smoking clover