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Rockwell 56-kbps modems out

A two-week shipping delay gave competing 56-kbps modems a head start, but there are signs Rockwell might catch up quickly.

Rockwell Semiconductor (ROK) says it has resumed shipments of chipsets for modems using K56flex technology after a four-week delay in production.

The shipments mean wider availability of K56flex-based modems, probably by next week. Their delay gave modems based on competing technology from U.S. Robotics (USRX) a head start in the race to win over consumers, but there are signs Rockwell might catch up quickly.

Currently, 56-kbps technology from Rockwell or Lucent Technologies doesn't interoperate with USR's 56-kbps technology, called x2. Consumers must use a service provider that supports the same type of technology.

USR started shipping its modems to customers in late February. By March, Cardinal Technologies also started shipping modems based on x2 technology. A number of companies that initially supported only K56flex have started shipping modems supporting both technologies, in part due to the delays.

One such company is Practical Peripherals, a subsidiary of Hayes Microcomputer. Hayes, which is only selling K56flex modems under its brand name, also purchased Cardinal Technologies last month in an attempt to steal some sales away from USR.

Some modem manufacturers in the Rockwell camp, including Motorola (MOT), had to hold back retail shipments of their 56-kbps modems because of poor chipset performance under certain network conditions.

However, not everybody held shipments back. Diamond Multimedia shipped its SupraExpress 56i and 56e K56flex modems on March 24 in spite of the problems because their modems could be updated with a piece of software that would fix the connection problems. On the whole, the Rockwell-based modems were in short supply while USR was filling store shelves.

Though slow out of the gate for client-side modems, Rockwell is starting to show significant wins on the other important side of the equation--online service providers.

Rockwell, Lucent, and America Online announced that the online service will soon begin field trials of K56flex modem technology in some cities. Lucent is supplying the technology for the Ascend central site equipment being used by AOL. Neither Lucent nor Rockwell has had to delay development or deployment of equipment to online service providers.

AOL will begin using the K56flex modem in an estimated 175 markets after the trials have been completed, the companies said in a joint statement.

"Having AOL announce support means a lot because they get so much publicity and are so well known by their base of customers," says Robert Rango, general manager for Lucent's modem and multimedia group. "AOL is bundled with just about every multimedia PC, and that means a lot for us because our biggest customers are PC manufacturers. Their customers now will be connect to AOL when they unpack the box," Rango says.

The announcement may start a trend among other online service providers. AOL had previously announced support only for x2 technology from U.S. Robotics.

With users buying both USR and Rockwell-based modems, service providers will have to decide whether they can afford to support only one technology. If they do, they risk losing customers to providers that use a different technology.

U.S. Robotics, for its part, risks losing a portion of the large market share it hoped to secure when it announced last year that all the major online providers, including AOL, CompuServe, and Microsoft Network, would support its technology.