More: Companies Scramble to Ship V.90 Modems
Retail Week - 4:30 p.m. EST Fri., Feb. 27, 1998
Diamond Multimedia, 3Com, Zoom Telephonics and BestData
leaped to the forefront of vendors bringing V.90 modems to
the retail market this week. But Newcom said it might wait
until September to bring V.90 modems to market. The
discrepancy reflects the unclear reception V.90 modem are
expected to receive at retail until Internet service
providers adopt the new technology, a process that is
expected to take up to six months.
This week, as new 3Com modems based on the International
Telecommunications Union's V.90 draft standard began
arriving in stores, retailers advertised sharp cuts on
older 56K modems. 3Com also announced plans to introduce a
$99 V.90 Winmodem by the end of March.
Ernie Raper, an analyst with VisionQuest 2000, Moorpark,
Calif., credited 3Com for the price cutting. Raper said that
3Com prompted similar price cuts among its rivals when it
released its x2-based 56K modems last March, well ahead of
the competition. "It's 3Com's market strategy to get (V.90
modems) out there and early," he said.
Critics, however, say 3Com is doing a soft, token launch for
its V.90s as it grapples with inventory issues. The company
had posted a shortfall of about $400 million in sales in
December when it began cutting inventory levels in the
channel, according to 3Com's financial statements. After
completing its merger with U.S. Robotics last July, the
company admitted overstuffing the channel with 56K modems.
In November, it announced a plan to cut inventory levels from
10 to 12 weeks to six to eight weeks in the channel.
Competitor Diamond, which plans to ship its V.90 modems
next week, claims it is the only modem maker releasing V.90s
nationally. A 3Com spokesman maintained that 3Com's V.90
release targets the entire country.
Meanwhile, other rival modem vendors face the dual challenge
of shipping new V.90-based modems and notifying the public
that their existing modems are already upgradable to V.90.
Labels on many 56K modem packages have noted for some time
that the items were upgradable to a "new ITU Standard."
Since the ITU introduced the draft standard and dubbed it
V.90 in early February, though, retailers say modems without
the V.90 notation look outdated. "The 56K modems we have now
are pretty much glorified 33.6K modems," said one buyer.
But other retailers said the V.90 introduction was a
non-event. "People only care about the speeds," said Terry
Malone, a sales associate for Ekos Computers, Flint, Mich.
"This might put a few people's minds at rest, but most
people won't care."
"Our customers are more worried about being able to reach
56K speeds," said Deana Luetje, a computer specialist for
Wolfe's Camera Shop, Topeka, Kan. "They don't understand
that sometimes you'll still get 33 (Kbps)."
But some vendors aren't taking any chances. To address the
V.90 issue, Hayes enlisted a detailing firm, Alpharetta,
Ga.-based Channel Reps, to put V.90 stickers on the
company's 56K modem boxes in retail stores this week.
Hayes, and subsidiaries Cardinal Technologies and
Practical Peripherals, are expected to start shipping V.90
modems in late March, a spokeswoman said.
Other vendors are projecting March and April ship dates for
their V.90 modems. Zoom Telephonics, Boston, announced
Wednesday it was shipping V.90 modems in large volume.
Street prices are expected to range between $119 and $149
for the internal model and between $139 and $179 for the
external model.
Many retailers reported that BestData's V.90 modems could
be ordered. BestData could not be reached for comment.
Shark's V.90s won't hit shelves until mid-April. The company
said it will not receive V.90 chip sets from Rockwell
Semiconductor Systems until late March. A Rockwell
spokeswoman, however, confirmed that Rockwell began shipping
V.90 chip sets to vendors in early February. She pointed out
that Diamond is a Rockwell vendor.
Newcom may hold off on a V.90 release until as late as
September, a spokesman said. The company is one of the few
vendors to take issue with the fact that V.90 is a draft,
or place-holder, for an officially ratified standard.
Following ITU protocol, the standard can not be officially
released until the next meeting, in September.
In the meantime, Newcom is putting stickers on existing
modems that say "Upgradable to the ITU Standard," avoiding
the V.90 moniker. The vendor had avoided such a sticker in
the past because about 10 percent of its inventory was not
upgradable to the new standard. The spokesman said most of
those modems, based on early x2 chip sets from Texas
Instruments, are gone.
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