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Technology Stocks : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: Beachbumm who wrote (12918)	1/5/1998 10:24:00 PM
From: Mang Cheng	Read Replies (1) \| Respond to of 45548

Holy smoke ! Lot's of article tonight - this one about explosion of modems demand predicted by a rockwell guy : January 05, 1998, Issue: 696 Section: Telepath "56-Kbps compromise will speed up modem sales" Paul Korzeniowski Sponsors of two competing 56-kilobit per second modem technologies finally reached a compromise last month and pledged to support a common international standard. At a meeting in Orlando, the International Telecommunications Union (ITU) was able to find middle ground between two high-speed modem techniques: the X2 technology advocated by 3Com Corp., Santa Clara, Calif., and the 56KFlex technology promoted by Lucent Technologies Inc., Murray Hill, N.J., and Rockwell International Inc., Newport Beach, Calif. The ITU this month is expected to meet in Geneva and release a draft of the standard; formal ratification is expected by September. Vendors said they planned to deliver modems and remote access systems that support the standard-called V.pcm-by the end of the first quarter. Users that have already purchased 56-Kbps modems will receive free upgrades so their systems will also comply with the specification, vendors said. The two camps had been at odds since the ITU held its first meeting on the subject in September 1996, and the squabbling alienated potential customers and slowed sales. "Corporations talked with their pocketbooks; many simply were not going to buy 56-Kbps modems until there was a standard," said Kiran Narsu, an area director for Giga Information Group, a Westport, Conn., market research firm. While sales of 28.8-Kbps and 33.6-Kbps modems rose at healthy rates last year, 56-Kbps modems shipments fell short of expectations. That was one reason why 3Com in September announced disappointing quarterly earnings. Joe Dunsmore, vice president of new business initiatives at 3Com's Skokie, Ill., office, said the company based its business plan on the expectation that the ITU would forge a 56-Kbps compromise sooner than it did. "There were a couple of times we thought a compromise was close, but then negotiations fell apart," he explained. Suppliers were concerned because 56-Kbps modems represent their next networking bonanza. It turned out, however, that many consumers purchased the systems despite the standards debate. 3Com's Mr. Dunsmore said vendors have shipped 20 million 56-Kbps modems since 1995, which is 8 million more than the number of 33.6-Kbps modems delivered during the same time frame. With the standard almost in place, sales should rise ever higher. VisionQuest 2000 Inc., a Moorpark, Calif., market research company, said 56-Kbps modem sales will reach 20 million units this year. "Now that the standards issue has been resolved, the 56-Kbps modem market will explode," predicted Rauof Halam, vice president and general manager of Rockwell's network access unit. "Users want faster Internet access and 56K modems offer higher speeds than other dial-up modems." Paul Korzeniowski is a free-lance writer in Sudbury, Mass. E-mail your reaction to this article to telepath@cmp.com. Copyright (c) 1998 CMP Media Inc. Mang