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Analysts: 3Com trying to woo enterprises with new ad campaign

Following strategic missteps and profitability woes, 3Com hopes a new ad campaign will remind enterprises that Cisco and HP ProCurve aren't the only vendors in town.

3Com Corp. has come out swinging like a prize fighter with a new, aggressive marketing campaign, but some industry experts question whether it will be the knockout punch the company needs to stay standing in the enterprise networking ring.

Launched this week, the campaign is Marlborough, Mass.-based 3Com's most significant branding initiative in five years. It features four different print ads in more than 30 publications, including The Wall Street Journal, BusinessWeek, Fortune and Forbes. The ads urge readers to go to an interactive macro Web site that features testimonials from some of the company's enterprise customers.

Steven Schuchart, an analyst with Sterling, Va.-based Current Analysis Inc., said 3Com is trying to woo back large organizations after the company abandoned the enterprise market in the late 1990s to focus on small and midsized businesses. That venture fizzled, and 3Com has continued to stumble while trying to re-enter the fiercely competitive enterprise market.

But Schuchart called the blitz 3Com's vehicle to "let people know they're not just a name from the past. They really need to reignite their presence in that market, so the aggressiveness is not surprising."

Rob Whiteley, a senior analyst with Cambridge, Mass.-based Forrester Research Inc., said 3Com is trying to take over second place in the enterprise networking market, where Cisco Systems Inc. is the undisputed champ and Hewlett-Packard Co.'s ProCurve unit and Nortel Networks Ltd. are gaining steam.

"They're pulling out all the stops," Whiteley said. "This is 3Com's attempt to get into the limelight and capitalize on the fact that there is no strong No. 2 right now."

Abner Germanow, program manager for Enterprise Networks services at IDC in Framingham, Mass., said an aggressive campaign is necessary for 3Com to simply hold ground.

"The other vendors have to get aggressive and creative in how they approach the market" when going up against Cisco, Germanow said. "You can't win customers if you're not invited to the table, and if the customer doesn't know you want to be invited to the table, that makes it even harder."

But one strong push, Whiteley said, might not be enough. Instead, he said, 3Com has to continue fighting to prove it can penetrate the market. Whiteley said he's skeptical.

"It's important that they set the tone here and maintain that pace," he said. "3Com is going to have to stick with this to prove they're not just a flash in the pan. I'm a little bit concerned if they can maintain it or not."

One thing organizations want to know, Whiteley said, is "What's different now than in the past?"

3Com has recently added new security, convergence and performance features to its enterprise networking portfolio, including its acquisition of intrusion prevention specialist TippingPoint Technologies Inc.

"3Com has always had good technology; it just lacked good execution as a company," Whiteley said. "So a strategic realignment is necessary, but probably not sufficient."

In one of the four new spots, the "Introducing Cisco Plus Ad," 3Com acknowledges that Cisco controls major market share, but points out differences in the two companies' approaches.

"Specifically, it lets people know that unlike Cisco, 3Com is based on open standards, it builds intelligence that optimizes applications, it has automatic core-to-edge security and it doesn't require enterprises to be locked into a vendor and/or conduct forklift upgrades," according to a press release from 3Com.

Whiteley credited 3Com for recognizing Cisco's power, a tactic rarely used in the highly competitive market.

Germanow agreed. "It's a fairly humble campaign," he said. "A lot of what they're saying is, 'Give us a chance.' They're not trying to take over the world. They're trying to sell products they think will help."

Still, Schuchart said, it's not likely that this push will take 3Com to the top of the enterprise networking market.

"I don't think they're about to knock anyone off the perch," he said.

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