More: 3Com to Sell as Much as $100 Mln in Switches to USA Global Link
Santa Clara, California, Feb. 10 (Bloomberg) -- 3Com Corp.
has signed a letter of intent to sell at least $100 million in
computer networking equipment to USA Global Link Inc., the
largest provider of international discount long-distance service.
The agreement calls for 3Com, the No. 2 networking company,
to supply USA Global with 500 of its remote access concentrators
over a three-year period. The concentrators are used to route
incoming voice and data calls.
3Com and competitors like Cisco Systems Inc. and Ascend
Communications Inc. are aggressively pursuing business with
telephone and Internet service providers, which are expected to
spend more than $7 billion on networking equipment in 1998, 30
percent more than in 1997.
''This is a growth opportunity (the networking companies)
are not going to overlook,'' said Esmerelda Silva, an analyst
with International Data Corp.
If USA Global buys all the equipment in the agreement, the
contract will be one of the most lucrative for 3Com in the
carrier market, said Ross Manire, vice president for 3Com's
carrier business unit. 3Com had revenue of $5.75 billion in 1997.
USA Global will use the switches in its network in the U.S.
and overseas, with the first ones being deployed in New York and
Ireland, company officials said.
3Com shares rose 1/4 to 32 5/8.
Either Bloomberg screwed-up on the amount or $100 million is
the initial amount. The 3COM site is sticking with $1.2 Billion:
usagl.com
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