SAN FRANCISCO--There's a familiar ring to futurist discussions in the networking industry these days, and they all involve one word: convergence.
3Com's (COMS) chairman, president, and chief executive, Eric Benhamou, is convinced that
the current separate voice and data infrastructures will merge into one, with the resulting focus being on services that add to the functions of this type of network.
His sentiments echo those of his cohorts in the industry. 3Com competitors
such as Cisco Systems, Bay Networks, and Ascend Communications are all gunning to
provide the equipment that integrates voice-based systems with data-driven
infrastructure. They join telecommunications monoliths such as Northern Telecom and Lucent Technologies.
"There's are many, many opportunities for these two infrastructures to
begin converging," Benhamou told a half-filled hall at a conference sponsored by the Red Herring, a publication focused on the technology sector. "I'm very pleased to see our industry widen its scope."
In a wide-ranging presentation, Benhamou also stressed the profound change
the networking industry is experiencing, with customers moving from
shared devices to switches and high-speed technologies such as ATM (asynchronous transfer mode) and Gigabit Ethernet, and deregulation changing
the landscape for voice and data service providers.
The 3Com chief said his company is well-positioned to take advantage of this ongoing convergence by leveraging its market strengths at the so-called network edge, where it has a leading share in several low-end equipment categories and provides fast-selling networking cards and modems
for connections. As a result of the merger with U.S. Robotics, 3Com also enjoys thriving remote access and personal organizer divisions.
Because of this focus, however, Benhamou admitted that his firm will not compete directly for the network "core," where Cisco has made waves in an
effort to displace entrenched telecommunications firms despite simultaneous overtures
to partner with them. 3Com has chosen the second route in
"It's unclear that Cisco will be successful in partnering with these
people," the executive added. "We've chosen not to compete in this public core
network, except at the access edges."
When the dust clears in a few years, Benhamou predicted there would only be
three or four equipment providers remaining, given the economics involved
and the trend toward reducing the number of companies providing equipment
for a particular layout.