3COM official's comment on ASND
Common Goals Provide A Hook For Net Merger
Date: 8/6/97
Author: Michele Hostetler
A modem's squeals and squelches are music to
the ears of Casey Cowell.
Cowell co-founded Skokie, Ill.-based U.S.
Robotics, which networking giant 3Com Corp.
of Santa Clara, Calif., bought this summer for
$8.94 billion in stock and other considerations.
U.S. Robotics plays in the lucrative field of
remote access. The company's modems and
related products connect people to the Web and
link networks of computers together.
San Jose, Calif.- based Cisco Systems Inc. and
Santa Clara, Calif.-based Bay Networks Inc.
also are pushing into remote access. And
another highflying remote-access competitor,
Alameda, Calif.-based Ascend Communications
Inc., announced plans this spring to buy
Cascade Communications Corp. of Westford,
Mass.
Cowell recently discussed with IBD the
changes in the marketplace and the reasons
behind the 3Com-USR merger.
IBD:
How do you see U.S. Robotics fitting into
3Com?
Cowell:
3Com is the leading player for connecting PCs
to local-area networks and interconnecting
local-area networks. Robotics is the leading
player for connecting PCs to wide-area
networks, principally through the telephone.
Going forward, as speeds go up, especially on
wide-area networks, we will place a premium
on end-to-end connections straight through a
(WAN) into a (LAN). We felt we had to be
able to provide that complete solution. We see
the most dramatic change in speed and value . .
. happening at the edge of both LANs and
WANs, where the end user resides.
IBD:
While Ascend and Cascade deal with their
merger, are competitors seeing some openings?
Cowell:
I think so. I really think that was a combination
that was in reaction to our combination.
Anytime you're reacting, typically speaking, it's
more difficult. I think they have more (product)
overlap. 3Com and Robotics have very little
overlap.
IBD:
What do you think of the push by Bay and
Cisco into remote access?
Cowell:
I think their entry really validates our business
position. They feel they have to try to establish
a position in wide-area networks and providing
wide-area access into their backbone networks.
It's a huge market. Lots of companies will do
well. I really think 3Com is in the best position
to take advantage of all these speed and service
enhancements that will happen over the next
few years.
IBD:
What kind of speed and service enhancements
will happen?
Cowell:
The big change in wide-area networks in the
last year is really the increase in modem speeds
to 56 kilobits per second. The big technology
there is our (56-kbps technology), called X2,
which we announced last fall and began to ship
early this year. We have (as customers) close to
1,000 Internet service providers in almost 2,500
cities in 17 countries. Fifty-six kbps and X2 is
the place to be for the next couple of years.
After that, we think it will be digital subscriber
line technology, which will get users into the
millions-of- bits-per-second range.
IBD:
With greater transmissions speeds, what kinds
of new products will be feasible?
Cowell:
The classic example is video phone. Finally
there will be enough bandwidth or speed
available over the telephone network that you
can do live video. I think it'll be a big market. It
will make it possible to connect anyplace - your
home, remote office, while traveling, what have
you - to anybody, anywhere. The best way to
lead in those opportunities is to have the
greatest core technology and market position
with both wide-area and local-area network
products.
IBD:
How has the market evolved in the past few
years?
Cowell:
The big changes are PCs have become much
more powerful and it's possible to create
programs to use them for sophisticated
communications. Also, the willingness of the
user to accept it as a normal tool of life . . . just
like talking on the phone, watching TV or
driving a car.
(C) Copyright 1997 Investors Business Daily,
Inc. |
