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Technology Stocks : The New QLogic (ANCR) -- Ignore unavailable to you. Want to Upgrade?

To: Patrick Sharkey who wrote (12720)	11/30/1997 9:28:00 AM
From: Craig Stevenson	Read Replies (3) \| Respond to of 29386

Patrick, My confidence has been shaken somewhat from the fact that I really don't know what caused the slide from $10 to $5. There has been a lot of speculation regarding that event, but no real facts. The Reg-D selling angle seems plausible to me, but I also have a strong suspicion that there was more to it than that. (I'm just not sure what.) Equally as concerning is the buying that came in soon after the conference call. I can't explain that either, especially with the short interest as high as it is. Significant insider buying would shore up my confidence, and I'm sure it would help the confidence of others. Especially since it appears that there are significant reasons why we SHOULDN'T see insider buying. I am still confident in the Ancor team from a technical and management standpoint, and I agree that these people haven't been around long enough to have had a MAJOR impact yet. Undoubtedly, this team is more capable than the previous team. The Q3 revenue numbers show that there is potential there, and Ancor is positioning itself to capture a significant portion of the Fibre Channel market. One thing that is easy to forget is that under the new team, we have had two consecutive record revenue quarters. My biggest concern is with the apparent ineptitude of the marketing effort. Let me give an example. The November 24th issue of LAN Times has an article on page 53 titled, "Bullet train to the data vault". It is a good article, containing a lot of positive statements about Fibre Channel, and its role as a SCSI replacement. There is even a quote from Fred True, MIS director of AT&T's data center. Here is the part that got my attention: "The glue to build such storage networks will be a new generation of intelligent switches. These switches will automatically reconfigure themselves to recognize additional storage servers that are plugged in to the network fabric. Coming to market this fall will be systems from Sun and Brocade Communications Systems Inc." "Many companies keep moving people around and adding new buildings," says Brenda Christiansen, vice president of marketing at Brocade in Santa Clara, Calif. "They can't predict where they're going to need storage access. Fibre Channel's distributed environment gives them a flexible migration path." Almost EVERY Fibre Channel related article contains a quote from Brenda Christensen, and a plug for Brocade. Notice the not so subtle tie between Sun and Brocade? There is no mention of Ancor in this article. My biggest complaint is the lack of a proactive or reactive marketing effort to combat this sort of thing. A proactive approach would consist of aggressively contacting the proper people at these industry magazines and discussing Fibre Channel technology in general, and Ancor technology in specific. A reactive approach (less desirable) would be to contact the people who wrote these articles, give them the facts, and request that they contact Ancor in the future. To my knowledge, NEITHER of these approaches is being used, and if they are, they have been totally ineffective. Somebody is doing a tremendous job of proactively striking at the trade press, capturing customer mind share, and building a strong marketing base on which to grow a company. Her name is Brenda Christensen. I would like to see someone at Ancor do the same thing. I do not think the emphasis on Brenda C. is out of place. If you read as many trade magazines as I do, and saw her name (and Brocade's) all over the place, you would see the difference between how the two companies are approaching the marketing effort. Brocade is essentially getting something for nothing. Ancor is essentially getting nothing for something. A big difference, in my opinion. I'm not saying that Brenda is the sole genius behind Brocade, she is just the most visible. Somebody obviously gave her a good budget and the time to make a lot of phone calls. That person deserves some of the credit too. I just don't know who that person is. I agree that it is unlikely that a single switch maker will dominate the Fibre Channel market, and I believe that Ancor will get their share of business. I just don't like forfeiting the mind-share portion of the equation by default. Craig