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

To: craig crawford who wrote (19351)	7/18/1998 12:55:00 PM
From: Mang Cheng	Read Replies (1) \| Respond to of 45548

"Ex-Digital Exec Makes A Move To Networking" Date: 7/20/98 Author: Michele Hostetler Bruce Claflin's new job will be to make Eric Benhamou's life a little easier. Claflin is the new chief operating officer at networker 3Com Corp. And his boss is Benhamou, the company's chief executive officer. Benhamou announced in June he was looking for someone to handle day-to-day duties at 3Com while he concentrates on the big picture. Claflin, a former executive at Digital Equipment Corp., now a unit of Compaq Computer Corp., will try to return 3Com to strong sales after several quarters of slow growth. Claflin most recently was senior vice president and general manager of sales and marketing at Digital. He also was in charge of Digital's PC business unit. Prior to that, Claflin worked at IBM Corp. for 22 years, and introduced IBM's ThinkPad line of mobile computers. ''I was very impressed with the depth of Bruce's experience in the PC industry,'' Benhamou said in an interview. ''The PC industry, of course, is not the same as the networking industry, but a lot of Bruce's knowledge of the business processes - the partners, the channels, the manufacturing processes and so on - apply directly to how we do business at 3Com.'' Benhamou says he plans to focus on 3Com's strategic partnerships with Siemens AG and Microsoft Corp. He'll also zero in on 3Com's role in the new data-voice networking field. Claflin left Digital when Compaq bought it because the PC maker planned to transfer him to its Houston headquarters. He lives in Boston and will stay until his youngest daughter graduates from high school next year. Claflin talked with IBD about his plans for his new job. IBD: What attracted you to 3Com? Claflin: It's really two reasons - the industry and the company itself. Just the industry is exciting. It has great growth historically. As far as we can see in the future, there's great growth opportunity. It's certainly not commoditized. The technology is driving what previously had been separate networks of voice, video and data into converged networks. Of course, this means there are enormous opportunities for companies that have capabilities to capture them. That leads me to 3Com. I was very impressed with the company. (It has) a very strong market presence (with) almost $5.5 billion in revenue, leadership in a number of key segments in the industry (and a) very strong financial structure so that the balance sheet would support aggressive plans. IBD: How does 3Com's culture differ from Digital's? Claflin: My preliminary view is 3Com clearly has a little bit more entrepreneurial spirit. In a company like 3Com, it's not as large and has not been around for as many years, which can be a mixed blessing. But I think, on balance, it creates a more vibrant environment. Having said that, Digital has a strong culture, and there are similarities in terms of respecting people, valuing technology and innovation, and a strong balance sheet. IBD: How do you plan to apply your past experience to 3Com? Claflin: I think the first thing is to use my ears more than my tongue, certainly for the first period of time. While I bring experiences and biases, I think it's very important that I spend my first days and months just listening and learning. I expect the first 90 days to be characterized by a lot of travel. I'll meet broadly with our people throughout the world at all levels. I'll meet with our customers, our partners, industry analysts. The goal is simple - to understand what we do well that we can capitalize on and what we don't do as well that we need to improve. I think 3Com's strategy is very sound. My focus will be more on the execution and operational side. My first 90 days will be intense listening and learning, and then applying my experience to what I've learned. IBD: Where do you think 3Com needs improvement? Claflin: Clearly, from an overall view, we need to get our revenue growing at a faster rate than it has in the last few quarters. Historically, 3Com was characterized by very high rates of growth as well as very good profitability. In the most recent quarter, the profitability was improved. My focus will be focused on driving the revenue side more as well. IBD: How does your ThinkPad experience translate to 3Com's mobile computer, PalmPilot? Claflin: I think there will be similarities. ThinkPad was a wonderful experience in that we took a piece of the business that was not doing well and got it growing very rapidly. Why did it work? We leveraged very aggressive technology and priced it aggressively, promoted it well and sold it through channels that were well positioned to succeed (and) had low inventories and a high degree of training. Those are general characteristics that drove ThinkPad. I think they largely apply to success in the networking industry. IBD: Any specific ideas for PalmPilot? Claflin: No specific plans there. investors.com Mang

To: craig crawford who wrote (19351)	7/19/1998 10:22:00 AM
From: chenys	Read Replies (2) \| Respond to of 45548

About PalmPilot. See nytimes.com Free registration if asked for password.

To: craig crawford who wrote (19351)	7/19/1998 11:49:00 AM
From: Edwin	Read Replies (1) \| Respond to of 45548

Craig, Where do see COMS trading in the next few weeks? I am also thinking about picking up some Aug 3o calls.

To: craig crawford who wrote (19351)	7/19/1998 7:51:00 PM
From: joe	Read Replies (3) \| Respond to of 45548

Mang and ALL; Previously, Mang had calculated about 4% revenues from Palm Pilot...just a guestimate as he said. We are all curious as to how much of 3Com's revenues the Palm Pilot is generating. (I'd say about 1/3 the 3Com advertisements I see are for the Palm Pilot) I have a new figure: 6.00% of revenues for Fiscal 1998. Here's the math: 5.5billion - total revenues for the year (got this from IBD interview with Claflin) ($400 + $150)/2 = $275 = average selling price of PP device. 1.2million devices at $275.00 = $330million $330million/$5.5billion = .06 => 6 % of revenues for the year. Another note: last year, 3Com sold 1.2million, and the forecast is for 2million this year ==> 66.66% growth for Palm Pilots Another note: What Donna Dubinsky and Palm founder Jeff Hawkins will be doing in the future: "Dubinsky and Palm founder Jeff Hawkins plan to start a company that will market consumer devices using the Palm operating software." ~~~~~~~~~~~~~~~~~~~~~ Big competition with MSFT Windows CE coming up. 3Com owns the Palm operating system. So, who knows, if 3Com can't ever get it together on the Network side, they can have a flourishing business with the future most popular operating system in the world<g>. (Maybe 3Com is quiet about this so as not to attract attention from MSFT<g>)