3Com ready to tackle '98

Company executives downplay recent troubles and roll out a detailed road map for the next few months at a Wall Street analyst briefing.

3 min read
3Com (COMS) executives downplayed the company's recent troubles and rolled out a detailed road map for the next few months at a Wall Street analyst briefing yesterday.

3Com CEO Eric Benhamou reportedly assured the financial community that the inventory issues that have recently stymied profits at the firm will be a thing of the past by the completion of the current quarter, which ends in February.

More significantly, company executives rolled out ambitious plans to saturate the market with new low-end and mid-range infrastructure equipment, high-end access hardware, and consumer-oriented networking products in the coming months, CNET's NEWS.COM has learned. The launches could breath new life into the company's tepid growth and quell rumors that last year's merger with U.S. Robotics has not been smooth.

With the upcoming push, 3Com will continue to shore up its expertise in low-end and mid-range markets for Ethernet-based networking equipment. Ethernet remains the dominant means to connect PCs and servers together in what is called a LAN, or local area network. A typical LAN is a department within a corporation or a layout found within a small business at a single locale.

Current market trends indicate a thirst for Ethernet hardware that can move data at 10 mpbs (megabits per second) and 100 mbps speeds, deciding which speed once a connection with a user is made.

Within the next few weeks, 3Com will unveil a series of low-end and enterprise corporate networking tools that address this evolving requirement and could temper the recent entry of Cisco Systems into the same market as well as stave off further encroachment from Bay Networks with its hot 350T switch.

The new introductions will also strengthen the company's portfolio for corporate enterprise networks, an area that has not been 3Com's historical strength, according to industry observers. They include:

  • A 10/100 mbps shared hub, a type of device that offers shared bandwidth for users, costing $79 per port.

  • A 24-port 10/100 mbps SuperStack 3300 switch priced at $175 per port, an aggressive move to gain share in this emerging market, with the potential to take advantage of upcoming support for gigabit-speed Ethernet, the next generation of the technology that is in the final stages of the technology standards process.

  • A 12-port version of the 10/100 SuperStack 9000 switch, dubbed the 9300, which also feeds into the hot 10/100 market and offers users migration to gigabit speeds.

    The market for gear that supports 10 mbps and 100 mbps Ethernet doubled from 1997's second to third quarters, according to market researcher Dataquest. "It's one of the bright spots in the business," John Armstrong, an analyst with Dataquest, noted.

    "It would make a lot of sense for them to be making a push in the 10/100 market," Armstrong continued. "If they really want to be No. 2 in the enterprise market place, they need to get more ports out there."

    Cisco is currently the recognized leader in enterprise corporate networking layouts.

    In the coming months, 3Com also plans to transition the remote access hardware it gained through U.S. Robotics merger into an all-purpose box for transmitting voice, video, and data over analog, cable, and DSL (digital subscriber line) modems. The multipurpose concentrator will enter a rapidly developing market for these types of devices.

    Cisco gained an early entry into this market with the introduction of the 3800 series last spring. Several smaller firms are also developing this type of equipment.

    Finally, the company will also update its bread-and-butter consumer product line, shipping a standards-based 56K modem by the end of this year's first calendar quarter, a long-anticipated move. Within the next month 3Com will also ship a 10/100 networking card for PCs, called the 3C905B, that offers the technology on a single piece of silicon.

    A 3Com spokesperson could not immediately be reached for comment on the company's plans.