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

To: chenys who wrote (19856)	7/29/1998 8:45:00 AM
From: Box-By-The-Riviera™	Respond to of 45548

3Com inks China deal, eyes Asia for Palm Pilot By Scott Hillis BEIJING (Reuters) - 3Com Corp., the world's second-largest maker of computer network equipment, inked an agreement Tuesday to invest up to $100 million in China and said it plans to start selling its Palm Pilot handheld computer in Asia. The Santa Clara, Calif.-based company's growing business in China was expected to help offset a slowdown in Japan, company chairman Eric Benhamou told Reuters. Under two letters of intent signed Tuesday, 3Com plans to set up in China a joint venture consulting company and a research institute to promote its products that combine video, audio and data onto a single network. The joint venture would eventually create strategic networking products, including software and hardware, tailored to China's specific needs, Benhamou said. 3Com had about $150 million in sales in China last year, capturing 31 percent of the market for networking devices such as switches, interface cards and remote-access servers. Benhamou said Beijing's drive to build its computer and telecommunications networks had convinced him China was one of the most important markets in Asia for 3Com. "We are encouraged to see the renewed focus that the Chinese government has placed on infrastructure build-up, particularly its networking infrastructure," he said. The Japanese market showed little sign of recovering and that meant the investment focus would be on faster growth markets such as China, Benhamou said. "We will obviously want to see some signs of life and energy coming out of Japan before we resume the basic investment we had before," he said. While 3Com is eyeing small and medium-sized businesses in the United States as a new growth market, Benhamou said sales in China would mainly be fueled by government offices and state firms trying to leapfrog into the information age. Benhamou also said 3Com would start shipping local versions of its popular Palm Pilot series of handheld computers into Asian markets such as Hong Kong and Japan over the next year. Americans and Europeans have snapped up more than two million of the devices, which can store telephone numbers, send and receive e-mails and plan events. The Palm Pilot series has about two-thirds of the U.S. market for handheld computers and more than 40 percent of Europe's. Its dominance, though, is under threat from competing devices such as those running a slimmed-down version of Microsoft Corp.'s ubiquitous Windows platform. Benhamou said 3Com would have to fight to hold onto its market share but voiced confidence that the backing of thousands of independent programmers writing applications for the gadgets would help keep it on top.