3Com chief touts convergence
By Ben Heskett
Staff Writer, CNET NEWS.COM
April 6, 1998, 5:30 p.m. PT
URL: news.com
SAN FRANCISCO--There's a familiar ring to futurist discussions in the networking industry these
days, and they all involve one word: convergence.
3Com's (COMS) chairman, president, and chief executive, Eric Benhamou, is convinced that the
current separate voice and data infrastructures will merge into one, with the resulting focus being
on services that add to the functions of this type of network.
His sentiments echo those of his cohorts in the industry. 3Com competitors such as Cisco
Systems, Bay Networks, and Ascend Communications are all gunning to provide the equipment
that integrates voice-based systems with data-driven infrastructure. They join telecommunications
monoliths such as Northern Telecom and Lucent Technologies.
"There's are many, many opportunities for these two infrastructures to begin converging,"
Benhamou told a half-filled hall at a conference sponsored by the Red Herring, a publication
focused on the technology sector. "I'm very pleased to see our industry widen its scope."
In a wide-ranging presentation, Benhamou also stressed the profound change the networking
industry is experiencing, with customers moving from shared devices to switches and high-speed
technologies such as ATM (asynchronous transfer mode) and Gigabit Ethernet, and deregulation
changing the landscape for voice and data service providers.
The 3Com chief said his company is well-positioned to take advantage of this ongoing
convergence by leveraging its market strengths at the so-called network edge, where it has a
leading share in several low-end equipment categories and provides fast-selling networking cards
and modems for connections. As a result of the merger with U.S. Robotics, 3Com also enjoys
thriving remote access and personal organizer divisions.
Because of this focus, however, Benhamou admitted that his firm will not compete directly for the
network "core," where Cisco has made waves in an effort to displace entrenched
telecommunications firms despite simultaneous overtures to partner with them. 3Com has chosen
the second route in this area.
"It's unclear that Cisco will be successful in partnering with these people," the executive added.
"We've chosen not to compete in this public core network, except at the access edges."
When the dust clears in a few years, Benhamou predicted there would only be three or four
equipment providers remaining, given the economics involved and the trend toward reducing the
number of companies providing equipment for a particular layout.
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