With Palm successfully launched, and the merger with USR stabilized, Eric was now at the end of his tenure as CEO of 3Com. Here is details his final decisions, and reflects back on some mistakes. SM: In our next series, I would love to examine Palm. Finishing up with the 3Com story, however, the USR
Finally, poised for success, 3Com did spin off Palm as a separate company. SM: I think you find that a lot with folks who are entrepreneurial by nature – they like to be in charge of their creations. I know you ultimately did spin off Palm as a separate company, when did that happen? EB:
3Com acquired US Robotics, and then USR started shrinking in the modem market, one of its primary franchises. In a royal nightmare that ensued, Eric lost the advantage that 3Com had built as part of its first turnaround. SM: Were there any positives which came out of this mess? EB: The only thing that came
Here we begin to examine the current market segments where the multicore processors are having a significant impact. The two major markets are networking and multimedia applications. SM: Coming back to where your applications are – complex networking applications, and multimedia, right? AA: I don’t know if you want to use the word complex, because
3Com challenged Cisco with a Boundary Router strategy that threatened Cisco’s core router franchise. SM: So what prevented you from finally catching Cisco and passing them? EB: In 1997, there was one major shock for 3Com. More and more enterprise networks had to extend into carrier networks. Enterprises could not build all of these large
SM: Is this when you began to close the gap on Cisco? EB: There was one play that we used which enabled us to close in on Cisco, and we called it Boundary Routing. Cisco was driven to more complex solutions than us. They positioned routing as something of a magic art, very complicated and
SM: Did the market understand your positioning as an integrated networking solution? EB: I think they did. Of course we were coming from behind in routers, and we were behind SynOptics in hubs, and we were behind others in single categories. We started to strengthen our position in all our segments, and this helped because
3Com started growing revenues again in 1992 on the strengths of new products. The company grew about 15 fold in a decade, in terms of revenues, and became profitable again. SM: That was a golden age in networking! EB: Yes, and shareholder value went from the million range to billion range. It was fun, because