This article is from the Aware web site www.aware.com (it's frame based I can't refine it better). Go to "Press relations" then "Aware in the Press". I believe this article addresses several of the issues we're discussing and provides some insight as to their strategy at that time. Bear in mind that xDSL solutions were getting a lot of press at the time. Aware seemed to have momentum then. My own additional comments follow the article.
February 9, 1998
Aware to hire 50 to support high-speed modem
sales
Firm hopes new workers will help boost customer base
for Internet product
Rex Crum Journal Staff
BEDFORD-- At least 50 new jobs will be created at Aware Inc. with the introduction this month of the company's new Universal ADSL high-speed modems, according to Jim Bender, president and chief executive officer.
Bender said most of the new hires will be either engineers or sales people to boost the company's customer base for the new ADSL (Asymmetric Digital Subscriber Line) technology, which is expected to revolutionize Internet data transfers.
The Bedford-based company currently employs about 80.
Universal ADSL allows both voice and data communications to occur on a single copper telephone wire. The technology eliminates a customer's need for line splitters to handle incoming information.
Most importantly, though, is how much quicker data transfers can occur with Universal ADSL. Current high-end modems run at standard speeds of 56,000 bits of information per second (bps). Universal ADSL, however, can download information from the Internet at up to 1.5 million bps, and has the potential to upgrade to 8 million bps.
By introducing the first Universal ADSL modems, which cost approximately $3,000, Aware stands to capitalize quickly on a market that is so young, and has so much room to grow that exact estimates on its value can not yet be made.
"How big is this market?" asked Bender. "How high is the sky? There are about 700 million phone lines worldwide, so this is like going from using a cocktail straw to a fire hose."
Aware's stock last week traded at $13.13, down from a 2-week high of $16.88 on June 10, and up from a low of $8.50 on April 2.
It reported a loss of $1.8 million, or 9 cents a share, on revenue of $1.8 million for the quarter ending Dec. 31. During the same period in 1996, Aware lost $92,000 on revenue of $1.7 million.
Bender said he was hopeful the new ADSL modems would help Aware turn a profit soon.
"The board said they didn't care if we lost money in '97, but they wanted to be assured we were moving toward the right direction," Bender said.
Industry officials say the potential for ADSL could cause larger high-tech giants to go on a buying spree to get the smaller developers under their wings before the market takes off.
Dallas-based Texas Instruments Inc. launched such a salvo with its $395 million purchase of Amati Communications Corp. of San Jose, Calif., in December. Amati had been developing software for the ADSL industry.
However, despite the potential for a large windfall, Bender insisted that, at least for now, Aware is not being shopped around.
"We're hoping to stay independent and we're not trying to get acquired. Right now we're just trying to serve our shareholders' interests and we feel it's better to stay as we are," said Bender.
Aware finds itself among a group of companies that actually appears to be working together to create a unified technology. The Universal ADSL Working Group (UAWG), made up several firms, including Houston-based Compaq Computer Corp., Microsoft Corp. of Redmond, Wash. and Norwood-based Analog Devices Inc., is throwing its support behind the effort to ensure the compatibility of ADSL products and services.
Michael Neiberg, a telecom analyst with Furman Selz LLC in New York, said this consortium, with Aware as it focal member, should speed up ADSL's public acceptance.
"One of the big problems that has slowed development of ADSL has been disagreement over a standard. So this group is good news for the industry, and great news for Aware," said Neiberg.
Jerry Fishman, Analog's president and CEO, said the industry realizes a need for an ADSL standard for the technology to gain wide commercial acceptance.
"The real issue is going to be how the market develops," said Fishman. "Everybody believes in the need for a single standard if this technology is to be deployed in the mass market."
c 1998, Boston Business Journal
Where does a $3000 modem fit in? Maybe this is their router product? I certainly isn't a G.lite modem.
As to "engineers or sales people" - it would be nice to know if anyone was hired. Anyone been to their HQ? Is it big enough to accommodate a significant increase in employees? Has anyone seen newspaper ads?
If a relationship with 3COM is forthcoming how do you see that working out for Aware? Do you think 3COM would make modems that Aware would resell under the Aware name? Wouldn't 3COM buy rights and sell through their own channel?
Re-reading the article I don't think the reference to the board is as significant as I may have suggested. However, the big questions are - are they headed in the right direction and which way is it?
Steve |
