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Technology Stocks : Dialogic ready to soar, funds buying -- Ignore unavailable to you. Want to Upgrade?

To: Jay M. Harris who wrote (516)	12/7/1997 4:58:00 PM
From: Jay M. Harris	Read Replies (1) \| Respond to of 674

To the board, I would view the Clarent relationship with Microsoft as a negative for Dialogic, because DLGC's gateways already incorporate the ITU standard. This announcement implys that MSFT and DLGC have not ironed out plans to attack the market in a uniform fashion. Dismissed earlier this year as technological whimsy, IP telephony products are now being introduced with a frequency bound to capture IT managers' attention, if not their purchase orders. Lucent Technologies will unveil next week software for voice over IP conferencing, and Vienna Systems will launch a new IP telephony network service. And voice processing vendor Clarent is preparing a strategic marketing alliance with Microsoft. Lucent Technologies' Elemedia division is building the foundation for IP conferencing with its CX1000S and CX2000S software modules. Lucent will make the modules available to other vendors developing Internet voice-conferencing applications. "Right now, IP telephony products are point-to-point," said Elemedia president Joe Mele. "Software that uses our components will be able to enable conference calls that are as high quality as point-to-point calls, but with large numbers of participants." While Mele said that conferencing is a fairly simply matter using pulse-code modulation telephony, IP creates some unique challenges. The biggest hurdle is conferencing together multiple compressed voice feeds, with acceptable quality in real time. Both modules will be available to developers in the first quarter of next year, and Mele said he expects other vendors to begin shipping products by next summer. In an effort to leverage its line of IP telephony hardware, Vienna Systems will announce next week a partnership with Boston-based IP telephony service provider VIP Calling to deploy a global IP telephony network. "Private networks are so much more efficient as a transport medium," said Kerry Hawkins, Vienna's vice president of sales and marketing. "In the short term, this kind of virtual private network is necessary for IP telephony, so it's necessary for us. Standards aren't widely available or deployed, so you need single-vendor networks to make it work." Zona Research analyst Barbara Ells agreed and pointed out that, by creating a specialized virtual private network, Vienna is, in effect, creating its own market. "There are a lot of infrastructure problems with IP telephony that have to be ironed out before it really works," Ells said. "Everyone keeps talking about the Internet as if it's one thing, but there are a lot of different pieces that do different things, and there will have to be specialized resources for IP telephony." Meanwhile, Clarent and Microsoft had planned to unveil a strategic alliance for the cross-promotion of each other's products next week, but they put the announcement on hold to iron-out last minute details. Under the deal, Clarent is expected to promote Microsoft's NetMeeting collaboration software and integrate the International Telecommunication Union's H.323 standard for IP-based conferencing into its gateway product so it can communicate with Microsoft software. According to Ells, Microsoft is testing the IP telephony waters through the alliance. "Contrary to what Bill Gates might say, Microsoft just wants to be in every business," Ells said. "NetMeeting already has some voice-over-IP capabilities, and it's normal that Microsoft might want to expand on that."