Related Links

Is 'Network Management' an Oxymoron?, January 25, 1999 Yo, Server Market! Here Comes Intel, February 8, 1999 Intel's Adventures in Serial Numbering, February 22, 1999 With Friends Like These..., March 8, 1999 Network and Systems Management: Not Happening, March 22, 1999

Other Columnists this issue

Business to Business By Brian Walsh Top of the Stack By David Willis

Company Directory

Browse our directory to get data, starting with a particular company.

Reader Service

Allows you to request additional product information from our advertisers.

Print The Full Article

ClickHere

E-mail this URL

ClickHere

Buy the Book

Gigabit Ethernet shipments are up. Way up. I don't think that's a surprise to anyone. The technology appears to be mature enough for a good portion of corporate buyers. And, as we'd expected, lots of Gigabit Ethernet sales are coming at the expense of ATM. In the 18 months that Gigabit Ethernet has been around, it's garnered 8 percent of backbone port shipments and 4 percent of server port shipments, according to Infonetics.

These numbers are pretty strong, considering most major vendors were late in getting their Gigabit Ethernet products to market. As more products appear, these numbers will climb. Many Gigabit Ethernet naysayers are complaining about the technology's fitness for deployment. Nevertheless, a number of enterprises are using this technology, especially as they push Fast Ethernet to the desktop. It's looking like the naysayers will have their comeuppance.

Wherefore Art Thou, Strategy? Cabletron made the news this week with its strategy du jour: The company plans to get into the services business. Cabletron has a professional services group that takes in about $200 million a year. It hopes to bring that up to $1 billion. But Cabletron is in a tough spot. It positions itself as a competitor of Nortel, Cisco and Lucent--which is surely a losing proposition. Each of those companies is infinitely larger than Cabletron and can easily compete on the levels of service, price and product line. Each also has a successful professional services group that supports large sales of equipment.

Entering into the services game seems unlikely to advance Cabletron's cause. First of all, Cabletron wildly overestimates the market's appreciation of Spectrum (its management software). Spectrum is a good package, but Cabletron certainly won't grow a $1 billion services business around it. The company isn't perceived favorably enough to grow a services business without a killer product line to back it up. If companies aim to purchase professional services, there are well-established consulting firms that can do the job. The idea of Cabletron becoming a serious competitor to Computer Associates or Tivoli is also a stretch.

Cabletron has always believed that it could provide a value-add that would somehow make its products seem attractive even at a premium price. The enterprise market has rarely bought into that strategy, much to the detriment of Cabletron. The company was so convinced that it needed to play in a premium-priced market that a telco guy was briefly installed as the company's CEO. Cabletron didn't make much of a dent in the carrier space and I doubt it will do any better in services. We'll await tomorrow's new strategy.

On the Road to Recovery Finally, there's Olicom. This company almost had a corporate aneurysm after the release of a column I wrote about high-speed Token Ring. Well, Olicom recently announced that it would be building products to help customers make the transition to Fast Ethernet. Damn, that's what my column was about! I actually think it's great that Olicom is jumping on the Ethernet bandwagon. And I think it's finally doing its customers a huge favor.

My only question is, where was Olicom a couple of months ago? Of course, I'd love to take credit for the company's miraculous turnaround on Ethernet, but since Olicom announced products with this latest strategy, I think it's fair to assume that this has been its game plan for some time. I suppose it wouldn't seem right for one of the founders of the Fast Token Ring Alliance to come out with a migration strategy at the same time that it came out with Fast Token Ring products.

So there you have it. Gigabit Ethernet is hot, Cabletron is adrift and Olicom sees the light. All are making headlines. And I've decided to trust my initial instincts. They have nothing in common.

Send your comments on this article to Art Wittmann at awittmann@nwc.com.