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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: emichael who wrote (13043)	3/24/1998 10:57:00 AM
From: Jim Lamb	Read Replies (1) \| Respond to of 77400

Cisco sees more purchases, revenue shift By Kevin Morrison SYDNEY, March 24 (Reuters) - Cisco Systems Inc said on Tuesday it expected to continue to grow by acquisition, while boosting the proportion of group revenue from video, voice and data network equipment services. ''I think there is a good chance that our service provider revenue, directly or indirectly...will if we are successful move from 30 percent to 50 percent of our revenue by 2001,'' Cisco president John Chambers told reporters after a business luncheon speech. Chambers, who is on a short visit to Australia to meet customers and see Australian prime minister John Howard on Wednesday, said the increase in revenue from voice, data and video network technologies would be helped by acquisitions. The expected change in Cisco's current revenue stream away from its traditional market in computer network equipment supplies into voice, video and data would mean competing more with telephone equipment supply groups, he said. ''If you look at who our likely competitors are going forward, in terms of the strongest players (they) are Lucent, Nortel, Ericsson, Siemens, Alcatel and NEC,'' said Chambers, who is also Cisco chief executive officer. ''We would like to partner with at least two or three of those if we can,'' he told reporters after giving a speech to the Trans-Tasman Business Circle. Cisco has formed a pact with Alcatel (CGEP.PA) of France last year. Lucent Technologies Inc (LU - news), Nortern Telecom Ltd (Nortel) (NTL.TO - news), Ericsson (LMEb.ST), Siemens AG (OTC BB:SMAWY - news; SIEG.F), NEC Corp (Nasdaq:NIPNY - news; 6701.T) and Alcatel are looking to boost sales in internet related technologies, which combine data, video and voice. Chambers said Cisco expected further consolidation in the industry, but saw existing players in the network equipment making sector such as Bay Networks (BAY - news), 3Com Corp (COMS - news) and Newbridge Networks Corp (NN - news) to remain the major competitors. Cisco, which has grown sales 10-fold over the past five years to about US$6.5 billion, largely through mergers, plans about 15 acquisitions this calendar year with an increasing amount in video, voice and data technology firms, Chambers said. ''Anywhere between a third to a half of our acquisitions will go in the area of voice, data and video integration because that market is going to consolidate,'' Chambers said. He said the future acquisitions would mainly be small non-public companies with a strong engineering focus. ''We also prefer companies that are small, rather than mergers amongst equals, We think merger amongst equals fail.'' The strategy has worked for Cisco with the 24 acquisitions the company has made over the past four years, he said. About 90 percent of the purchases had been successful with a merger staff attrition rate of six percent, although it was still to early to judge six mergers, he added. -------------------------------------------------------------------------------- Nice move so far today,just shy of all time high. Jim