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Technology Stocks : 3Com Corporation (COMS)
COMS 0.00130-87.0%Nov 7 9:30 AM EST

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To: Home-Run who wrote (45438)12/13/2003 4:59:12 PM
From: Home-Run  Read Replies (1) of 45548
 
INSIDE TECHNOLOGY (from Chicago Tribune)
3Com hopes large companies will connect with VoIP calls


JON VAN
Published December 13, 2003

Breaking up a voice phone call into packets and moving it over a network--the way e-mail and other data move--is far more efficient than dedicating a whole connection exclusively to one conversation, the way traditional telephone calls are made.

But it's also trickier. The various packets have to travel quickly and get to the other end in the right order so the voice sounds right. With data, order of arrival and speed doesn't matter because a chip can straighten it all out and make things right.

Voice over Internet protocol is a hot technology because it has worked out most of the problems to enable phone calls to travel over data networks. Especially attractive are such VoIP features as converting voice mails to e-mails and back again.

Internet telephony, as it also is known, has been popular among hobbyists and smaller business enterprises for years, and many long-distance calls travel at least part of the way in the VoIP mode.

But one market VoIP has been slow to conquer is the large-enterprise customer. Because most big businesses have extensive infrastructures that would cost a ton of money to replace, executives are reluctant to embrace a new technology until they're certain it's worth the cost.

Among the Internet telephony companies seeking to crack the large-enterprise market is 3Com Corp., which has experience in VoIP in two sectors. 3Com's facility in Rolling Meadows has provided long-distance phone carriers with Internet telephony technology, and the company also provides systems to schools, hospitals, small businesses and other customers.

Smaller systems don't scale well to serve large enterprises, said Dave Hattey, a 3Com exec, but it turns out that 3Com's experience serving telecom carriers can scale down to serve enterprise customers. The company's familiarity with building features for smaller systems adds to the mix to make what Hattey sees as a very attractive product.

One attribute is that 3Com's system can work with existing public branch exchange, or PBX, systems. That means companies can phase in their embrace of VoIP and don't have to replace existing infrastructure right away.

"We see large enterprises adopting this technology over a three- to seven-year time frame," Hattey said.

VoIP is beginning to take off as phone companies market it to consumers. That will have a beneficial effect for firms such as 3Com, said Hattey.

"As volume goes up, it drives down equipment costs," he said. "It's a lot like Wi-Fi [wireless networking], which started as a business tool and then was adopted by consumers. That drove down costs and made it even more valuable for business."
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