|Korea IT Times recently interviewed Bruce Claflin, CEO of networking equipment maker 3Com. In order to overcome the global economic slowdown, 3Com has improved efficiency by restructuring its operations in product development and distribution, said Claflin. He also said 3Com is realigning its product development, manufacturing and supply chain model in order to increase efficiencies and deliver on its business strategy.|
Q.What has been your major goal since taking office in 2001 What do you see as your biggest challenges ahead
Therefore, I had to initially focus on preserving our financial position. As a result we have U.S. $1.4 billion in cash. More recently we have been focusing on driving growth for our company and industry.
To that end, we established a joint venture with Huawei Technologies in November 2003. Through this joint venture, we are now able to offer a full range of high-quality switching and routing products at a very competitive price for larger enterprises. In addition, we have been investing in other emerging product categories such as wireless, security and Voice-over IP (VOIP).
3Com will continue offering a broad line of innovative, feature-rich products for our enterprise and small business customers, helping them reduce the total cost of ownership of their networking infrastructure.
Q.Major networking vendors are experiencing difficulties due to the global economic slowdown. What is your plan to overcome this situation
3Com was one of the first IT companies to recognize and respond to the global economic slowdown.
To overcome this situation, we improved efficiency by restructuring our operations in product development and distribution to leverage enterprise growth opportunities at a lower cost structure. 3Com is realigning its product development, manufacturing and supply chain model in order to increase efficiencies and deliver on its business strategy.
We are managing our low growth businesses while investing in highgrowth areas such as security and IP telephony. By utilizing partners and strong R&D capabilities, 3Com is increasing its ability to bring to market a highly-competitive and comprehensive portfolio of enterprise networking solutions that excel at low cost to buy and own.
Q.3Com is releasing high-end products in order to expand market share. What is the background for this move and future business policies
3Com is committed to being a leading enterprise solutions provider. We have been significantly expanding our product portfolio in order to do this. 3Com has been an established player in the SMB market and now our aim is to further strengthen our presence in the enterprise market.
For example, the joint venture with Huawei enables 3Com to broaden its switch and router product portfolio while leveraging lower cost capabilities in China to provide high-performing, quality products at a lower cost of ownership.
Q.In the Asia-Pacific region, India and China are often considered the most promising markets. Additionally, the rapid growth of the Korean market is an example of the region's strength. What is 3Com's business strategy focusing on the Asia-Pacific area
Korea is one of 3Com's high growth markets in Asia-Pacific. In Korea, we will target the enterprise market by forging stronger relationships with our major channel partners and system integrators. We will support our tier-one systems integration partners with technical education, strong after-sales service and support for open architectures, providing easy-to-use solutions. In China and Japan, we are attacking the market through our joint venture, Huawei-3Com.
Q.3Com seems to be aiming to be the powerhouse in the Ethernet switch market. What is your road map for R&D investment in gigabit Ethernet devices
As part of its ongoing commitment to enterprise customers and channel partners, 3Com is continuing to expand its Ethernet product portfolio, which has established 3Com as the only vendor to offer a complete end-toend Ethernet solution with switches and NICs. Just as 3Com was a leader in driving the transition from Ethernet to Fast Ethernet in the 1990s, 3Com is extremely well positioned to drive the transition from Fast Ethernet to Gigabit Ethernet in 2001 and to 10 Gigabit Ethernet over the coming years.
3Com has recently released LAN core backbone switch devices, the Switch 7700, Switch 7700R, and Switch 7700 4-slot, all for the enterprise market. It also launched the Router 3000 and Router 5000. We plan to release future iterations of these products as well as larger scale switches and routers, including the 8800, which is a 10GB product, mid-range Router 6000 and large scale Router 7000.
We also recently delivered a 10 Gigabitready product, which means that a customer will be able someday to use a 10 Gigabit "uplink" module to boost performance by connecting to a 10 Gigabit core. We also plan to deliver 10 Gigabit products at some point in the future. We will continue to scale up solutions to meet enterprise requirements for bandwidth and higher density network cores.
Q.Convergence between networking and security is one of the hottest issues in the networking sector. What is 3Com's strategy to address this issue
3Com's "pervasive network security" strategy is to create integrative secure networks. As an end-to-end networking solution provider, 3Com is uniquely positioned to overlay standards-based security technologies into the various elements of the network infrastructure as well as into purpose built security appliances, which are deployed at key points of vulnerability across the network. These security overlays include: Layer 2-7 firewall, virtual private network (VPN), authentication, authorization, intrusion detection system and intrusion prevention systems (IPS), anti-virus, security management, and policy.
Network security is an increasingly vital component of running a viable business. Consequently, networking vendors are expanding into the security arena through internal development, acquisition or key partnerships. 3Com's approach and its understanding of customers' end-to-end needs tfor pervasive network security is well ahead of the growing trend to integrate security technologies into traditional networking hardware and software. This approach should yield integrative secure networks and makes sense from a financial perspective because it reduces the management and implementation costs associated with trying to integrate point security technologies into the network.
Q.What is the current situation of 3Com's entry into the Chinese market through the joint venture with Huawei and what is your future plan
Our arrangement with the Huawei-3Com joint venture remains unchanged since the company began operations last year. Huawei-3Com delivers enterprise-networking solutions including routers and LAN switches - sourced internally as well as from 3Com - in China and Japan while 3Com has the rights to market and support the Huawei-3Com produced products under the 3Com brand in all other countries.
Outside China and Japan, 3Com leverages its world-class distribution channel partners to extend the reach of the Huawei-3Com products. And 3Com provides resellers access to its broadened line of voice and data-networking products, ranging from entry-level switches to highend routers with both wired and wireless access, all at attractive value points.