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Technology Stocks : Shiva -- Ignore unavailable to you. Want to Upgrade?

To: Doug Skrypek who wrote (2422)	11/6/1997 9:31:00 AM
From: jim detwiler	Read Replies (1) \| Respond to of 5036

NEWS FROM AEA CONFShiva Corporation After several disappointing quarters, Shiva's management is in the midst of changing the corporate strategy. The old strategy was aimed at competing directly with 3COM (U.S. Robotics) and Cisco in the market for corporate remote access and with Ascend in the market for ISP dial concentration. The old strategy was not successful as evidenced by the company's financial performance this year. The company has successfully recruited new management, is in the process of changing its strategy and is scheduled to introduce several new products over the next few months. It is premature to assign any level of success to the new team and its new strategy, but the situation is probably worth monitoring because of the general lack of interest the company is currently receiving from investors and analysts in general. The new strategy is based on the premise that although most observers expect demand for remote access to continue to accelerate, corporations are beginning to strain under the ever-increasing complexity of managing these networks and the growing cost of maintaining the investment in remote access equipment. Corporations would like to outsource all of the headaches of supporting remote access without giving up control of who gets access to the network. Corporations would like their service providers to support all of the expense of building and maintaining a remote access network, while allowing corporations to continue to set policies on the type of access that will be allowed. For this new vision to come to pass, traditional remote access gear must metamorphose into two distinct pieces: remote access hardware (call termination) and remote access software (access policies such as security and authentication). Shiva's newstrategy and new products are aimed at addressing the market for remote access software, leaving the remote access hardware market to Ascend, 3COM and Cisco. The vision is interesting in our opinion, and it appears that the company is one of the first companies to address this market (a second early entrant is New Oak Technologies, a privately held company based outside of Boston). Nevertheless, executing the vision will not be easy. Although we believe that this vision may in fact be correct, the market may take some time to develop-the customers are being asked to change, which is always difficult, even if it is in their best interest-and it is difficult to effect change in an already public company. In addition, the incumbent vendors, particularly Cisco, will also try to address this market, so the window of opportunity will not remain open for long. Nevertheless, we are taken with the fact that the company is in the process of changing its management team and its product porfolio, radical changes for most organizations.