To: gfr fan who wrote (6823 ) 10/3/1998 4:57:00 PM From: pat mudge Read Replies (1) | Respond to
They are winning most every major new deal out there. They also have ATM access technology for the enterprise and carrier edge that NN can't compete with. CSCO's Stratacom stuff is behind NN, but CSCO can leverage the carrier's dependence on CSCO's routing base, and new CSCO switches are around the corner. However, CSCO wants the world to go packet - they would rather have routers control the carrier core as compared to ATM switches from Stratacom. This may hurt them long term, but it won't be NN who stings them - it will be ASND or someone else. NN's problems? They got distracted trying to be an enterprise player with ACC, UB, and that VIVID stuff. No profits to show from it. Also the high end IP stuff isn't there to date, so their core competency is the 36170 line, and it is under severe attack from ASND. I think their best bet is to marry themselves with someone who can use their market presence and ATM knowledge, and then beef up their R&D, mktg., and bring in IP from somewhere else. On their own, I think NN gradually loses share. (both market share and share price) profit represents I believe 5 times return of capital. A move that's positioned themselves to fill gaps where needed. I agree UB was a total disaster. So too was 3Coms' purchase of USRX, or so it appears. Mistakes are made. I agree NN could maximize their strengths through a strategic marriage. I also agree it won't be NN who stings CSCO, though it could be NN along with their as-yet-unannounced partner.
