Network World: Bay, 3Com at turning points

Bay CEO expected to detail back-to-basics rescue plan at NetWorld+Interop 97.

All eyes will be on Bay Networks, Inc.'s new Chairman, President and CEO David House next week as he climbs Mount Vegas to deliver the sermon of salvation for his downtrodden company.

Nobody expects House to smash stone tablets against roulette wheels or part the carpet of the Las Vegas Convention Center floor, but analysts and customers are hoping for something almost as dramatic from his address at NetWorld+ Interop 97. House is expected to disclose his plan for resurrecting Bay from the networking dead and leading its ascension to a better place.

But instead of miracles, observers expect House to lay out something more mundane - a back-to-basics strategy with the promise of better execution than his predecessors.

"It's probably counterproductive to get everybody thinking that something exciting is going to happen," said Thomas Nolle, president of CIMI Corp. in Voorhees, NJ.

By the time he delivers Bay's road map next week, House who took on leadership of the company last fall -will have had six months to size up Bay and its customers. As a result, Bay spokespeople are promising a talk rich in product, technology and business specifics.

House succeeds Paul Severino as chairman and Andrew Ludwick as president and CEO, the executives blamed for allowing Bay to flounder after the company was formed through the merger of Wellfleet Communications, Inc. and SynOptics Communications Corp.

"Unless [Bay does] something surprising, I expect [the company] to focus on switching," said Craig Johnson, director and principal analyst at Current Analysis in Herndon, Va.

Johnson also said he expects House to say Bay will focus on the corporate market, one of its traditional strengths, and will leverage the lOM/lOOM bit/sec autosensing Ethernet technology it acquired with NetICs, Inc. to drive down the cost of Bay's switches.

Lynn De Noia, director of consuiting services at Strategic Networks Consulting, Inc. in Rockland, Mass., said Bay needs to capitalize on its routing expertise. Developments such as its Switch Node Layer 3 switch are a good start, she said. Switch Node is a five-slot campus backbone switch that can learn Layer 3 forwarding information.

Bay also has to work on clarifying its marketing message, DeNoia said. There, the company has a leg up with a catchy moniker: Adaptive Networking.

"I'd like to hear them say that they're going to have a single, cohesive story with integrated products that people will have a good idea where to [deploy]," DeNoia said.

"To me, that's been one of the biggest [areas of] confusion. Their products overlap; it's not clear why I would use one vs. another."

But analysts do not want to see House repeat the Paul and Andy show of three years ago, when Severino and Ludwick delivered a detail-deprived monologue on the merits of their union on a steamy Atlanta night (NW Sept. 19,1994, page 1).

"They've worried more about protecting their installed base than they have about evangelizing new markets and new opportunities," CIMI's Nolle said. That may be with good reason because 35% of Bay's port shipments are still for shared-media LANs,Johnson said

"What they need to do now is put a stake in the ground, not in a concept sense but in a product and technology sense," Nolle said. "It's hard for me to believe that they have one."

House and Bay need that technological stand to be credible, said Don Miller, chief analyst for networking services at Dataquest, Inc. Bombastic "motherhood and apple pie" speeches about being standards based, evolutionary, simple and low cost will not cut it this time, he said.

"Adaptive Networking is the new marketecture," Miller said. "The question is: Where's the beef?"

Bay claims Adaptive Networking will have plenty of beef.