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Technology Stocks : 3Com Corporation (COMS)

COMS 0.00130

-18.8%

Nov 7 11:47 AM EST

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To: Patriarch who wrote (29602)	4/8/1999 9:38:00 PM
From: E_K_S	Read Replies (2) of 45548

Hi Patriarch - Thank you for the links about 3COM and their China investments. Here are some of my observations: (1) (http://www.3com.com/apr/news/72898.html#note) "...According to figures released by International Data Corporation (IDC) Asia Pacific in April 1998, 3Com's market share in the calendar year 1997 for switches, network interface cards (NICs), routers, hubs, remote access servers (RAS) was 31%, making 3Com the undisputed market leader in end-to-end networking technologies..." I believe 3COMS market share has slipped a bit with CSCO's share growing. 3COM needs to be very aggressive here and an alliance with Nokia may be their ticket. From the article: "...The joint ventures, together with a series of other initiatives will bring 3Com's total investments in China to over US$100 million during the next two years..." This investment by 3COM (during 1998 & 1999) represents about $0.30/share and should yield excellent dividends looking forward. No mention of any manufacturing facilities... perhaps more announcements to come. I understand that 3COM has a modem assembly plant in Sin Sin. I would like to see more manufacturing facilities for products to be sold both in China and for export to the rest of the world. The palm pilot would be an excellent product that would fit both of these requirements. Perhaps a Nokia alliance would help promote more demand for this product within China. Nokia is now #1 in China for cellular phone devises. From your second article: "...Together with our venture partners, 3Com will serve the systems integration and network consultancy needs of the very largest organizations such as China Telecom. Looking forward, the joint venture will enter its next phase to locally manufacture strategic networking products to serve the expansion needs of the Chinese economy..." I wonder if the scope of 3COM services might include a joint manufacturing agreement for production of networking product to be used both in China and for export to the rest of the world. Who might be the other partners....I still think Nokia would be a good fit as they already have joint manufacturing facilities and agreements with different Chinese agencies. Thank's for the posts. IMO this is a hidden jewel for 3COM that the market has discounted. When 3COM announces more specifics on their manufacturing partners within China, watch the WallStreet pundits take notice of good old 3COM. These relationships take years to develop and 3COM is well positioned (for the long term) to participate in this growing market. EKS

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