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Technology Stocks : Ascend Communications (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: djane who wrote (45869)	5/1/1998 11:05:00 PM
From: R.NORTH	Read Replies (1) \| Respond to of 61433

Does anyone know who's DWMD multiplexer is being used in Fore's new ASX-4000 ATM switch. TIA R.North

To: djane who wrote (45869)	5/1/1998 11:13:00 PM
From: djane	Read Replies (5) \| Respond to of 61433

Lucent, Cisco Square Off Over Internet Market Bloomberg News April 30, 1998, 12:31 p.m. PT San Jose, California, April 30 (Bloomberg) -- Lucent Technologies Inc. and Cisco Systems Inc. are barreling full-speed toward a lucrative new Internet market, putting them on a collision course likely to shake up the way they do business. The companies are spending billions on equipment that joins phone calls with e-mail and other data on one network. WorldCom Inc., AT&T Corp. and the Baby Balls are demanding the technology to offer high-profit new services to business customers. At stake are annual sales of $65 billion by 2000. To get the edge, networking leader Cisco needs to please phone companies looking for foolproof equipment and telecommunications powerhouse Lucent must deliver its goods in speeded-up Internet time. ''The carriers need reliable products and they want them now,'' said analyst Craig Johnson with PITA Group in Portland. Neither Cisco nor Lucent is accustomed to playing second fiddle. Cisco sells 80 percent of the gear that routes data traffic on large corporate networks. Lucent has 55 percent of the U.S. market for devices that direct voice calls. Shares of both are near records, with Lucent surging more than fivefold since its April 1996 IPO to 76 5/16 in recent trading. Cisco touched a high of 74 3/4 today, rocketing from a split-adjusted low of 15/32 after its 1990 IPO. ''They're going straight at each other in this market,'' said Paul Johnson at BancAmerica Robertson Stephens, who rates Cisco ''buy.'' Internet Market The nascent market luring Cisco and Lucent is known as ''public IP'' or ''IP telephony'' because the equipment links traditional public phone systems with data networks using Internet-based communications, or protocols. Instead of tying up an entire circuit for a phone call, IP breaks voice, data or video into small pieces called packets, sends them over the line and reassembles them at the other end. That way many calls can be sent on the same line simultaneously. Grabbing a share of the new arena is important as mainstay businesses for Cisco and Lucent slow. Cisco's annual sales growth has ebbed to around 30 percent from more than 70 percent a few years ago amid competition and price cuts from rivals 3Com Corp. and Bay Networks Inc. Lucent sells to customers like Bell Atlantic Corp. that still carry about the same amount of voice traffic they did years ago. Internet traffic, meanwhile, doubles every 6 to 9 months. East vs West While both face slowdowns, the companies couldn't be more different. Cisco is the consummate Silicon Valley startup-made-good, founded in 1984 by a husband-and-wife team at California's Stanford University to link computers so they could chat online. The frenetic pace of the Internet means Cisco's used to turning out its routers and switches quickly for a market where computer crashes can be a fact of life. It was a software glitch in a Cisco switch this month that put AT&T's data network out of service for more than 24 hours. Murray Hill, New Jersey-based Lucent predates the founding of former parent AT&T Corp. more than a century ago. It was Ma Bell's right arm for most of its years and counts the transistor and laser among its inventions. Lucent is more aggressive since its spinoff. Yet its focus has traditionally been on reliability rather than rushing new products out the door. ''Lucent's been pretty slow to market'' with data equipment, said Gregory Geiling, an analyst at J.P. Morgan Securities Inc., which has ''buy'' ratings on Lucent and Cisco. [and ASND] Where Cisco knows the Internet, Lucent knows phones. And not surprisingly, each says that its experience is what's needed to lure big customers in the IP market. ''We've spent decades building the world's most robust and reliable networks,'' said Bill O'Shea, president of Lucent's data networking systems group. ''We know how this stuff works.'' Cisco officials disagree. They say it's simpler for them to make phone equipment than for Lucent to build data-networking products, which are more sophisticated. ''It's an easier process to master,'' said Graeme Fraser, vice president of Cisco's Internet and service provider unit. Bulking Up Lucent upped the stakes this week, agreeing to pay $1 billion for Yurie Systems Inc., which makes IP equipment. The Yurie purchase came a week after Cisco said it will share technology with Lucent competitor Ciena Corp. Ciena's products let phone companies send more data over their fiber- optic networks. Cisco began its push into the phone market in July 1996 when it bought StrataCom Inc. for $4.5 billion, at the time the largest stock purchase in the networking industry. With each acquisition, the companies add another piece to a puzzle that PITA Group's Johnson calls ''a blurring of the lines'' between the voice and data markets. What will persuade buyers? ''It's about who can give the customers what they want,'' said Kevin Fong, a partner with the venture capital firm Mayfield Fund, which specializes in funding networking companies. While analysts are reluctant to handicap the victor, there's little dispute that it will be one of the two. ''At the end of the day, it's going to be a battle between Lucent and Cisco, with everyone else left behind,'' Geiling said.