Harold (pal)
All cliches aside .... 3Com's No. 1 problem is not its management ... not that management has been all that stellar. 3Com has serious fundamental flaws in its business mix that will doom it to these nasty downturns. Large proportion of the business is NICs, modems and low-end switching. There's growth here, but nothing to write home about given falling prices. So what is 3Com to do? Management cannot necessarily conjure up a solid customer presence, product portfolio and technology base in the next huge market: converged networks. They certianly can't do anything in-house other than some branch office voice/data integration. On top of that, 3Com simply does not have the sales force, customer service and support, and Service provider presence to break out of its nice, but not spectacular business. If you want to hate 3Com execs, you need to go back way before this latest earnings warning. But, I don't seem to remember you hating COMS and management a few months back.
COMS' Only bet is to get bought by some sucker. Of course, buying this mess is not exactly a great idea. The reason you and other COMS investors should be angry at Benhamou is for the USRX acquisition. COMS could have bought Cascade and gotten into the WAN switching arena. Instead, they decided to go with the cheap commodity stuff, and now they'll never measure up to WS expectations for the networking industry. Now, CSCO on the other is a much different story. And, I think you may start realizing that CSCO is a much better short and long term play than COMS. |
