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Technology Stocks : Novell (NOVL) dirt cheap, good buy?

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To: Allen Brown who wrote (20389)2/27/1998 10:37:00 PM
From: Jack Whitley   of 42771
 
<<I can say this because I finally got out of NOVL yesterday, but the network operating software battle hasn't even started yet. It's CISCO vs Microsoft. Networks will shift the power balance back to hardware. Routers,Routers,Routers and CISCOs software to run it.>>

Wrong. I think you will find that ATM is taking over the core in a big way. In the core, routers are becoming much less viable than smart ATM switches. Before Cisco takes on MSFT, they'll have to beat Ascend first. Peg the two stocks since January 1st and watch them the rest of the year. Cisco does have the router market in the enterprise, but that too is starting to change, though the herd is not onto it yet. Open standards are coming. The below is just one specific instance -

jww

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Ericsson Blazes Trail In Layer 3 Wilderness
By JEFF CARUSO

A lot of IT Managers wouldn't dare remove the routers they have come to rely on. But Bill Edwards did--and he insists his network is better off for it.

Although most companies are still experimenting with Layer 3 switching, Ericsson Inc. has already pushed aside most of its routers and dropped the new switches into its headquarters' backbone and wiring closets.

The results are lower costs, simpler management and a streamlined network that's better equipped to run voice and video over IP, said Edwards, network communications manager at Ericsson.

Ericsson built its backbone on four 3Com CoreBuilder 3500 switches that handle the bulk of the switching, and two more 3500s that maintain the route table information and serve subnets in its main building. The previous backbone equipment--four Cisco 7513 routers--currently handles legacy FDDI traffic. But as the company moves to Fast Ethernet, Ericsson will take the routers completely out of the main corporate network, using them in specialized, isolated networks, Edwards said.

"The beauty of the [Layer 3 switch] is I can replace conventional routers without worrying about the software overhead traditional routers have," he said.

Over the years, routers have taken on more and more functions, and router software has been upgraded to support a dizzying range of protocols, security and other features. But as companies standardize on IP as their primary protocol and Ethernet as a LAN transport, the need for so many functions is diminishing, and the raw speed of Layer 3 switches--which offer very fast routing capability--is tempting. The rich software that once was the strength of the router is now seen by some as burdensome overhead.

Just how widely the new class of switches will displace conventional routers remains unclear, said Michael Speyer, program manager at the Yankee Group. "Layer 3 switching has only just come out, and the people using them to replace routers are definitely early adopters," he said.

But the simplicity can be alluring. Before getting the new switches, Ericsson started systematically reducing the number of protocols it ran. Now, it runs just IP, with some AppleTalk in isolated segments of the network. This step made Layer 3 switching possible, since most Layer 3 switches support only IP.

Ericsson is trying to eradicate AppleTalk and plans to convert the 2,000 clients at its Richardson, Texas, headquarters to Windows 95 and IP by the end of the year.

Administering the core Layer 3 switches is simple, compared with the routers, Edwards said. Because it's essentially a switch, the network managers can save a copy of the CoreBuilder 3500's configuration somewhere else. If the switch goes down, getting it running again is just a matter of copying the configuration back to the switch, Edwards said, though that function hasn't been tested in a production environment.

Although Ericsson is both a provider and vendor of ATM networks, Edwards said ATM might not be right for every network. ATM is a big step, and with so much legacy FDDI at his particular site, it made more sense to migrate slowly.

"We're just not prepared to make that leap [to ATM] just yet," he said.

Still, Edwards said he wants to leave the door open. Right now, Ericsson connects different campuses in the Richardson area using Fast Ethernet, but the sites are probably too far apart for Gigabit Ethernet, Edwards said. That means ATM may come into play as a means of increasing the speed of the link. The 3500 can support Fast Ethernet, Gigabit Ethernet and ATM.

Though he couldn't quantify it just yet, Edwards said he believes the simplicity can save him money. When something breaks, he no longer has to bring in an expert who knows the ins and outs of Cisco's Internetwork Operating System for routers. Instead, all it takes is a midlevel technician, he said.

According to the Yankee Group, routers are taking more time and expertise to manage. During the past three years, the research firm found that the cost of router support staff has risen 6 percent, while the number of routers that an average staff member can administer has dropped from 15 to 13, Speyer said. Plus, Layer 3 switches have about one-tenth the per-port costs of conventional routers, although with a lot less functionality.

Still, moving to Layer 3 switches can be tough. One of the biggest hurdles is figuring out what policies to implement for managing bandwidth and quality-of-service (QoS) levels for different kinds of traffic.

Ericsson hasn't encountered this hurdle because it hasn't yet implemented 3Com's TranscendWare network management software, specifically designed for the switches. Right now, the company is using IBM's NetView for AIX for basic SNMP management.

The company will have to start looking at QoS, however, because it plans to run video over IP, enabling LAN users to hold videoconferences with remote users over the WAN. In fact, videoconferencing was a primary driver for Layer 3 switches. It has less latency than routers, so video can run over them smoothly, Edwards said.

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