Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: William Wang who wrote (20162)	8/4/1998 9:40:00 PM
From: Joe S Pack	Read Replies (1) \| Respond to of 45548

I think based on the link you provided some of the things are for diverting their real future problems on to Asia. If you look at the numbers CSCO's total sales in Asia is 11%. Of 11%, Japan accounts for 6% while other countries account for 5%. They are down to 4% and 3% respectively to a total drop of 4%. Even if the worst comes Japan will account for only another 4% drop which is highly unlikely. If you read the statement carefully CSCO has pricing pressure from startups, small companies and other established players in voice/video equipment. This means CSCO is getting aggressive competition from companies such as NT, LU, BAY etc. What they are saying is that their margin will start coming down. May be even their market share may come down. The future is not in backbone network. It is the edge that will be dominating the market share. But whether 3com will be able to dominate is a different matter and another couple of quarters will give a clear picture. 3com need to start dominating in Cable modems, Home Area networks and handheld devices market. They are there with PalmPilot but other two things areas not clear. Cable modem is more or less reaching a point of viable technology but it won't be as prevalent as phone lines in terms of reliable two way service for another 3 to 5 years. Home area network is still in fuzzy state and it may take while longer and it will be shaped by a serious competition from xDSL modems with Cable modems. All the best for the long-term bulls. -Karun

To: William Wang who wrote (20162)	8/4/1998 9:55:00 PM
From: simonds	Respond to of 45548

Actually, the situation in Asia gives 3Com an advantage over Cisco. 1) 3Com has factories in Asia (and Europe), Cisco doesn't. 2) Those (poor) folks will look for cheaper product in routers and switches that'll do the job for them. Look for the Chinese to buy more routers from 3Com. IGRP or EIGRP will have no marketing advantage in that part of the world; in most situation they can use OSPF which is an open spec. STACKABLE hub and switches are also key products to sell in Asia because customers can buy a stack at a time, and you know 3Com's capability there. 3) Cisco had an announcement about investment in China, however I haven't seen their follow through. If you're in COMS, you should watch 3Com's follow through on their recent similar announcement regarding investment in China. 4) TotalControl will outsell AS5200/5300 in Asia because of its management capability via Window NT. Bottom line is 3Coms products are all cheaper, and with good quality.