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To: hal jordan who wrote (30529)	2/10/1998 11:49:00 PM
From: Chemsync	Respond to of 31386

Aztech Systems Plans to Shift Gears to ADSL Modems <<According to Dataquest, a U.S. research firm, Aztech is the world's third largest supplier of modems, after U.S. Robotics and Maxtech of the United States>> February 10, 1998 (SINGAPORE) -- Aztech Systems Ltd., a major supplier of sound cards, is planning to develop ADSL and dual-line modems, and it seeks to launch the products in late 1998. Aztech president Michael Mun said in an interview that the market for ADSL and dual-line modems will expand greatly in early 1999. He said that the company's modem and telephony card business is expected to grow 20 percent-25 percent over the next 12 months. Also, Mun said that the company's sales of sound cards in 1998 will likely grow 10 percent. According to Dataquest, a U.S. research firm, Aztech is the world's third largest supplier of modems, after U.S. Robotics and Maxtech of the United States. Mun said Aztech's initial target is the large-volume original equipment manufacturer (OEM) market. The company's modems include 56Kbps USB modems as well as standard internal and external units. He said the company, which is the biggest rival of Creative Technology Ltd. of Singapore, believes that its main market is still growing at a brisk pace. The CD-ROM drive business has become "very competitive" and the outlook for the DVD-ROM business requires a cautious approach, he said. In the sound card business, Mun said Aztech was among the first to launch a PCI sound card that it will start shipping in February. The company will soon announce a deal with a major PC maker, he said. The OEM contract volume from the new customer is expected to be substantial, he said. Demand for 96- and 128-polyphony cards is growing but still isn't great in terms of Aztech's revenues, he said. Mun said Aztech, which is starting to ship PCI cards mainly through OEM channels, will introduce a retail product in March. It will be priced at about US$55 and the OEM product will be priced at US$25. The company has OEM contracts for its sound cards with Hewlett-Packard Co., Fujitsu Ltd. and Packard Bell NEC Inc. Aztech decided to quit the CD-ROM business and transfer equipment to the production of sound cards and modem cards. Any write-offs from the move will be minimal, he said. Aztech's customers will have the option of ordering CD-ROM drives through its third-party supplier in the Philippines. Mun said the third-party supplier designs and manufactures CD-ROM drives. Turning to the digital photo developer (DPD) peripheral business, which the company has focused on for two years, Mun said that the market has been slow to develop. Its sales of the product remain small. "The market is not ready, and people are still digesting the importance of the product," Mun said. Mun added that the regional currency crisis has had a minimal impact on Aztech because it is dependent on developed markets in the United States and Europe. He added that a lesson from the currency crisis is to conduct business in a prudent way. The company reduced its borrowings in 1997, compared with about S$65 million in outstanding loans in late 1996, he said. (Joseph Rajendran, Asia BizTech Correspondent) Copyright c 1997-98 Nikkei BP BizTech, Inc. All Rights Reserved

To: hal jordan who wrote (30529)	2/11/1998 1:39:00 AM
From: Pigboy	Read Replies (2) \| Respond to of 31386

Hal, << On another note, it looks like little PairGain may have beaten the big guys to the punch with their new DMT chip. Low power is the name of the game. PAIR may eventually be one of the best xDSL plays out there. We'll find out in a few more months when the dust settles a bit. >> Very true, but PAIR just lost USWEST to the people you just mentioned with the different line codes. Pair may well be one of the biggest and brightest in the xDSL field, but they don't have a major telco anymore. As you have mentioned, the Telco's have no need to rush the next six months, so a great chip now may not be the greatest asset. Time will tell. WSTL, on the other hand, seems (I say seems bc I just saw what happened to Pair) to have GTE Gov serv, GTE CLEC, BA, and some Bell in Canada, with partnerships with TI, LU, DSC, Fujitsu, and MOT. Please correct me if I am wrong but WSTL SEEMS a better play now. At the same time, I think that if WSTL or PAIR is strong in this market, the other one most likely will be too. all imho pigboy