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

To: Finder who wrote (27222)	1/25/1999 10:22:00 AM
From: Moonray	Respond to of 45548

More: 3Com, Broadcom vs. Intel in LAN-card mkt. Electronic Buyer's News - January 25, 1999 Silicon Valley- Ganging up against Intel Corp. in the market for LAN cards and related chips, 3Com Corp. and Broadcom Corp. have co-developed a family of single-chip controllers for Fast Ethernet networks. The first chip developed by the 3Com-Broadcom collaboration is a Fast Ethernet controller, which will be used exclusively in 3Com's LAN-card lines. Neither 3Com nor Broadcom intends to sell this chip on the merchant market yet, sources said. Still, the effort represents a new and bold strategy for 3Com, the world's largest supplier of Fast Ethernet LAN cards. The company holds more than 50% market share in this area, according to In-Stat Inc., Scottsdale, Ariz. Previously, 3Com made its own chips for its LAN-card lines, but it is now using merchant silicon to cut costs and compete more effectively against Intel. Intel, which still makes its own chips for its LAN-card lines, is the world's second-largest LAN-card supplier, with 24% market share, In-Stat said. But analysts said Intel is gaining on 3Com in LAN-card market share, prompting 3Com to join forces with Irvine, Calif.-based Broadcom, a producer of low-cost chips. Also giving 3Com fits are some Taiwanese suppliers of low-cost LAN cards. "The LAN-card market is very competitive," said Mike Wolf, an analyst at In-Stat. "Traditionally, 3Com has developed its own internal silicon, but this is expensive. The move [to team with Broadcom] is a way for 3Com to reduce its product costs." The stakes are high. The market for Fast Ethernet LAN cards showed an increase from 42.1 million units shipped in 1997 to 49.1 million units shipped in 1998, Wolf said. As part of the 3Com-Broadcom deal, the two companies have developed a single-chip device based on 3Com's media-access controller (MAC) and Broadcom's physical-layer (PHY) IC technology, according to Marty Colombatto, vice president and general manager of Broadcom's Networking Business Unit. This Fast Ethernet controller chip is designed for use in LAN-card products and LAN-on-motherboard designs, Colombatto said. Broadcom is also developing a line of 1-Gbit PHY chips for products from 3Com and other OEMs. Copyright ® 1999 CMP Media Inc. o~~~ O