Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Mike Buckley who wrote (18406)	2/22/2000 7:32:00 PM
From: buck	Read Replies (1) \| Respond to of 54805

Mike, As a student of the FC space, I personally don't believe that 64- or 128-port switches are necessarily next generation. This is nothing special in the internetworking world, and that world ain't that far from FC and SANs. I also can't imagine a world where Brocade managment, sales, and engineering is perfectly happy to stay with their 32-port switch for the remaining life of the company. I can't think of anyone who came from way behind, like you describe it. As a buyer and a seller, I have seen IT purchases be delayed for as long as 18 months by Gorilla promises of future products. Just like all of us have. If Brocade doesn't have an answer "just around the corner" for Ancor's forthcoming offering, I'll eat my hat. I can just hear the spiel now... Somehow, I don't think I've helped you any. buck

To: Mike Buckley who wrote (18406)	2/22/2000 7:46:00 PM
From: gdichaz	Read Replies (1) \| Respond to of 54805

Mike: Your post reminded me of when I bought the shiny pebble Cisco in the summer of 1990 as part of a basket of WAN networking stocks. For some time, another stock in that basket, Wellfleet, seemed to be ahead in WAN networking technology and in rapid quarter to quarter sales and earnings growth. I was delighted of course since both were selling their products like hotcakes. But two things changed all that. Wellfleet made a disastrous decision to link up with Synoptics Com (a LAN supplier) to be more of a "full service" provider. Just about everything that could go wrong did with that merger. And Cisco just kept plugging along, using its routers' software as a quality of service advantage. Not the routers themselves so much, but what we eventually recognized as Cisco's primary advantage and the real making of Cisco into the gorilla we know and have loved all these many years - the entire software system surrounding Cisco's routers - so that even Cisco's competitors began to be forced to offer it and it developed into a de facto standard. Fortunately there was an opportunity to see all this in time to move toward Cisco to ride its next wave up. Not sure that this is a full example, because Cisco was the larger company compared to Wellfleet and even though Wellfleet seemed to be pulling ahead relatively, this may have been more illusion than fact. It is all so long ago and my memory of it is so blurred now that I am not sure this is a valid example. But I think it may be close. I doubt that Wellfleet was "way ahead" and Cisco "way behind", but the market and most observers thought that Wellfleet was at least "ahead" and certainly Cisco showed the Wellfleet/Synoptics combination its dust. For the historians among you, Wellfleet/Synoptics became Bay Networks which was then absorbed into Nortel. I know of no other in my experience. Best. Cha2

To: Mike Buckley who wrote (18406)	2/22/2000 7:53:00 PM
From: cfoe	Read Replies (2) \| Respond to of 54805

Talk by Geoffrey Moore Last Wednesday evening (2/16) I attended a dinner hosted by the Haas Business School (Univ. of Ca ? Berkeley) with the support of others (Wharton, Harvard, etc.). The speaker was Geoffrey Moore and his topic was Being Profitable in the Internet Economy (sic), based his soon to be released new book. I will give a very brief summary here, but based on the talk I recommend reading the book when it comes out (I will). Basically Moore said that everything a company does could be put into one of two categories ? ?Core? and ?Context.? Core is what makes a difference for a company; that which drives revenues and eventual success. It is the ?key/must have?; it is what differentiates a company from its competitors. Context is everything else. It is what is ?needed;? it is not a "differentiator.? The key is to concentrate on the Core and ?outsource? the Context. Even here, you have problems, especially for established companies. The foundations of what is Core are shifting; Context has become a liability; Core becomes Context faster and faster than ever before. Companies need to ?design for outsourcing? He used as an example of this attempting to run up and down escalator. Also, even in outsourcing Context, it is only effective when you outsource to a company who has that as their Core. (One example used was Cisco using Selectron?s manufacturing expertise.) He gave lots of comparative lists and examples of how to apply these distinctions. (BTW ? Moore offered copies of his charts and I e-mailed him for them. If I get them (have not as yet) I will post a message here so those that want a copy can PM me their fax number.) Will be happy to take questions, but since my notes were skimpy, I can only rely on my memory if and until I get the charts.

To: Mike Buckley who wrote (18406)	2/23/2000 1:43:00 AM
From: RRRoarr	Read Replies (1) \| Respond to of 54805

One example would be Novell Netware in the early '90s. In those years, if you wanted to make really big bucks, you studied hard to be a certified Netware engineer. I still remember half the want ads in the engineer's section were either jobs for Netware engineers or classes to clone new ones. There were some proprietary architectures involved and Novell was the network software gorilla for a few years. Somehow all that was lost to MSFT. Thus began the long line of victims at the feet of the new Gorilla... Q-911

To: Mike Buckley who wrote (18406)	2/23/2000 2:43:00 AM
From: FLSTF97	Read Replies (1) \| Respond to of 54805

Next Generation Is there an example of a company in any industry with proprietary architectures that has produced next-generation products to get way ahead and stay way ahead after having been way behind in the earlier-generation products? Mike perhaps you need to narrow this question to "open proprietary architecture". If not one could argue that Microsoft vs Apple would fit this definition (even though MSFT's next generation OS was inferior!). A potential example may be Qualcomm with the CDMA vs GSM methods, but I'm not really clear on when the two architectures were conceived/released. FATBOY

To: Mike Buckley who wrote (18406)	2/23/2000 8:28:00 AM
From: gdichaz	Respond to of 54805

Mike: Q-911 is right. Shows that old age is affecting my memory. The way Novell was cut off at the knees by Microsoft is a better example now that I am reminded, than the Wellfleet/Cisco one I cited IMO. I was also in Novell heavily early in the 90's and watched with some amazement how MSFT beat them bloody. There were many reasons within Novell (management mistakes and technological complacency among them) for that of course, not just MSFT's complete, dedicated, no holds barred, aggressiveness. And as always with MSFT the major weapon was not so much a superior technology as marketing and value chain power. Apple was another loser to MSFT for many similar reasons. Not sure this is an example though of leapfrogging another company through superior technology, but more of superior management savvy and using every possible trick in the book (and even some perhaps outside "the book") to win. But it is certainly an example of pulling up fast on the outside and winning the horserace going away. Best. Cha2