We won't make Bay's merger mistakes, says 3Com's Benhamou

3Com.'s megamerger with US Robotics this week raises questions about industry consolidation, competition and product overlap - and has some pundits wondering whether the merger will work. 3Com Chairman and Chief Executive Officer Eric Benhamou thinks the two partners fit each other very nicely

3Com.'s megamerger with US Robotics this week raises questions about industry consolidation, competition and product overlap. 3Com Chairman and Chief Executive Officer Eric Benhamou discussed the deal with Network World Senior Writer Jodi Cohen.

On what U.S. Robotics brings to the table:

Benhamou: "They are much more than just a modem company. US Robotics offers WAN connectivity, and we are especially interested in their Total Control remote access server platform. They also have ADSL and 56K modem technology. Also, US Robotics gives us an immediate presence in the carrier market, where they control the largest ISPs, like MCI and Sprint. US Robotics also has a strong retail presence. We've never sold NICs retail before, which we'll now have an opportunity to do. Also, our OfficeConnect product line [of hubs, switches and remote access gear for the small office/home office market] will be perfect for retail channels. As networking becomes more mainstream, retail will become increasingly important."

On the merger's impact on customers:

"Enterprise customers will be the primary beneficiaries of this acquisition. Now they don't have to go to another vendor for remote access products. Also, LAN/WAN integration is key as people start seeing less of a distinction between the LAN and WAN. But not every customer feels a compelling need for an end-to-end solution. Typically, consolidation benefits the larger customers."

On the changing internetwork market landscape:

"We used to be a strong second to Cisco, but there was still a big space separating us. Now there's a big space separating 3Com and our nearest competitors. So today, there are two large, leading vendors, each with a different set of strengths. We just happen to like our strengths better. In fact, we're not attempting to look like Cisco. We're focusing on growing at the edge of the network."

On avoiding the same pitfalls Bay encountered with its merger of equals:

"We've seen [Bay] blunder an opportunity right in front of us, and we won't fall into the same traps. We will not attempt to create a single, monolithic company out of these organizations. This is a task we are very prepared to face. Actually, this deal has nothing in common with Bay other than the fact that they are both large mergers."

On competing 56Kbit/s modem technologies:

"Now we have a choice. The X2 U.S. Robotics technology is already shipping, and we'll drive it to market as fast as we can. But we'll also help develop a standard, which probably won't be set for another 12 to 18 months. Once the standard is set, we'll upgrade our products via software."

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