Compaq holds back deal with Cabletron

Networks Move to include networking products delays agreement.

Compaq is negotiating a move into network management software which has delayed the signing of an OEM agreement with Cabletron.

At the launch of Cabletron's Project Ignition corporate strategy in mid-March, David Kirkpatrick, chief financial officer of Cabletron, predicted the OEM deal with Compaq would be finalised within a couple of weeks (PC Dealer, 31 March).

But David Palmer-Stevens, director of marketing at Cabletron EMEA, admitted last week that a date for the announcement had still not been set. He said the deal initially only involved hardware, but Compaq had belatedly decided to consider extending it to include Cabletron's Spectrum network management suite of products.

He added: 'That may be why the announcement has been delayed.' Regardless of whether Compaq licenses Spectrum, the vendor has committed to resell Cabletron's top range of hardware products, according to Palmer-Stevens.

'It is not going to resell every product we have, but it will have access to all of them,' he added.

Palmer-Stevens declined to comment on the scope and value of the agreement.

Compaq is fine-tuning its networking division, pushing aside commodity items such as modems into other divisions and concentrating on selling high-end equipment and services.

The strategy shift represents a significant turnaround by Compaq from its bullish attitude three years ago about the prospects for its commodity networking products, saying then that the SME market was ripe for the picking (PC Dealer, 6 January).

Meanwhile, Cabletron has begun shipping bundled systems for ISPs. The three packages - dubbed SmartAccess, SmartPOP and SmartHosting - group products Cabletron has traditionally sold separately and are the first to be delivered by the vendor's ISP business unit.

Palmer-Stevens said: 'When ISPs needed a system in the past, they would have instinctively called Cisco because we've never really targeted that market before. But by releasing these bundles and branding them in this way, Cabletron is also hoping to gain mindshare among ISPs.'