Hi Peter,
Interesting question. Now that STXN has introduced the Eclipse product line (which is an "Intelligent Node Unit"... NOT a "digital radio"... see my post number 1552 on 6 January 2004), STXN has expanded its potential market and is also facing a new set of competitors. My impression (based on almost no research at all) is that the equipment from old-line manufacturers like Cisco does a good job terminating land-lines and handling other functions (like routing, multiplexing, cross-connect, bandwidth & speed control, etc) but the special needs of terminating wireless links are an afterthought with them (if they are handled at all). My guess is that the new Eclipse product from STXN not only puts wireless termination front and center... but that it also does a good job with land-line termination and with handling all the other functions. Importantly, it does all this in a single (2 rack unit) box for lower initial and recurring costs than the multiple (16 rack unit) boxes from the old-line manufacturers.
But a superior product, while necessary, is not sufficient for STXN to compete effectively in the long-run. Customers who could place big orders will be wary of buying from a small-fry like STXN. They don't want to piss off their primary suppliers without assurances that STXN will be around in the long run, that STXN will have the financial where-with-all to stand behind their products when some SNAFU arises, and that STXN will be able to handle much larger order-flow than they've seen in the past. So I expect the big customers to show interest, to test products and to place some significant (but not huge) orders with STXN. The trust and order-flow will have to grow over time. In the interim, Cisco and others will not stand still. They will develop products better able to compete on features/capabilities and cost with Eclipse. So, as always, STXN will have to continue their R&D efforts and come out with even better next-generation products in the years ahead.
One interesting question in this battle is how much of a barrier wireless termination/linkage is to the old-line guys. They may just ignore STXN for awhile since STXN's sales will still tend to go to customers who really want/need wireless links. Cusomers that don't need wireless links (probably still the biggest part of the network equipment market) may just say: "that's cute, but my regular supplier is coming out with a smaller cheaper box in a few months... I'll just wait for that." So STXN's initial impact on the Cisco's of the world may be small enough that the Cisco's of the world don't put much R&D muscle behind wireless connectivity. Maybe the Cisco's of the world will figure they can just buy their way into wireless connectivity solutions (rather than develop them) when their customers start demanding such features.
What do you think about all this?
Rob |
