Below is a short portion of the article noted by Stockaholic on reply 1117. Interesting... Matthew
How to get ahead by getting eaten alive
By Michael Surkan
....
"The modern, prearranged sellout is actually a brilliant
means of cheap financing and risk management.
Companies such as Cisco, 3Com and Bay Networks
can avoid risky R&D expenditures for uncertain
technologies, but they have their bases covered in
case something worthwhile pops up.
Just how entrenched is this new system of outsourced
product development? Consider this: Not one of the big
network hardware heavyweights has invested in
homegrown Gigabit Ethernet technology. Not even the
venerable Cisco has any Gigabit Ethernet products on
the drawing board.
Instead, we've seen the emergence of nearly a dozen
little companies, each forging ahead into the uncharted
territory of ultrahigh-bandwidth networking. Moreover,
nearly all of these startups are already paired off, none
too subtly, with a big sibling. Bay has bought Rapid
City, 3Com is talking to Extreme, and Cabletron is
more than a little cozy with Yago.
In reality, the big network hardware vendors have
become highly effective marketing machines, with
massive distribution and customer support channels.
Cisco and Bay can concentrate on incrementally
developing established product lines, harmonizing
newly acquired items to fit into the corporate lineup,
making all the boxes in the same color and developing
consistent command syntax.
At least where network hardware is concerned,
customers have overwhelmingly voted for one-stop
shopping rather than multistop, where they have to
contact numerous support departments when problems
arise.
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