Very interesting article about intel invasion of coms :
"Can Intel Duplicate Success In Other Markets?"
Networking
In the spring of 1997, Intel rolled out a new line of
Fast Ethernet-based chips and LAN cards, along
with hubs and switches for use in small offices.
The company sparked a furor by bringing out its
products at much lower prices. Wall Street
promptly battered the stock of 3Com, Cisco, and
other LAN equipment makers. Although Intel
stimulated demand for Fast Ethernet-based
products in the market, its moves cut into its own
margins as well as into its competitors', according to
Scott Randall, a senior analyst at Soundview
Financial Group, in Stamford, Conn.
Its pricing strategy quickly made Intel the world's
second-largest maker of LAN cards, behind Santa
Clara, Calif.-based 3Com. In total, the company
realized about $500 million or so in sales from its
networking business. But those numbers do not tell
the entire story, Randall said.
"Frankly, I think they are struggling a little bit in
networking," he said. "It's not one of their most
profitable units. ... If Intel is making money, it's not
by much."
Nevertheless, Intel pressed on last week, entering
the 1-gigabit Ethernet market with a line of chips,
modules, and switches. Later this year, the
company plans to join the home networking market
with a new line of products, said Dan Sweeny,
business manager at Intel's newly formed Home
Networking Operation, based in Hillsboro, Ore.
techweb.com
Mang |
