Xylan conf. call (post 2)
Kim: Expect Omni SR to contrib. substant. this quarter.
Re. ALA purch. of PAC ENgines: 1. Bulk of our sales to ALA is ATM related. PACENG. is giga. So impact is small.
2. PacEng. is expensive stuff, designed for high end.
3. 80-90% of price of enterprise network is in wiring closet, vs. backbone. ALA clearly says that they think our products COMPLIMENT those of PacEngines.
4. ALA has made it clear that they are moving into a competitor position against CSCO. This may create addit. opportunities with ALA.
5. Recently signed extension of ALA contract with broader opps.
So, our relat. with ALA continues to be good. But, our other direct, VAR sales are growing much faster. 68% vs. 59% prior quarter. This is an essential issue to us. We belive that volume direct business will grow fast, while IBM, ALA is modest growth. So, well on our way to diversified customer base. This direct, VAR growth will produce growth rate greater than our competitors, due to strnegh of our product. |
