3Com Corp says personal computer vendors have begun shipping machines certified under its Network Ready program, first announced in January this year. The Santa-Clara networking company has signed 27 partners for the program including personal computer vendors Dell Computer Corp, Gateway 2000 Inc and Acer Inc as well as distributors CompuCom Inc, Ingram Micro Inc and MicroAge Computer Centers Inc. Under the program, these vendors will ship Network Ready certified machines with a 3Com Network Interface Card pre-installed alongside relevant software and drivers. Buying the pre-configured systems, the company claims, will reduce the cost to corporate customers of installing networked machines. However, the move to pre-configure systems is clearly not new and the majority personal computers currently shipping are doing so with a Network Interface Card already fitted. With this program, 3Com is clearly aiming to make sure it is its own cards that are fitted as standard and it already believes that a significant number will. We estimate vendors signed to the Network Ready program account for around 20% of the worldwide PC market and that about a third of their sales will be Network Ready certified, says Wendy Walleigh, strategic marketing manager at 3Com.
$50 to $100 premium
Machines configured as part of the program will ship for around a $50 to $100 premium, Walleigh estimates. The Network Ready strategy is part of the company’s key push to protect its key network interface card business. Although it is the interface card market leader, with an estimated 40% market share, in the last few months it has seen its position increasingly under threat. In February, Intel Corp kicked off a price war by cutting the price of its network cards by up to 40% – a move which 3Com quickly matched (CI 3,112). As 3Com comes under increasing pressure from the high-profile chipmaker Intel and others, it is looking to the Network Ready Programme to boost the companies brand recognition as well as creating greater value for its Network Interface Card products in a market which is becoming increasingly commodity driven. As far as building brand recognition, 3Com’s Network Ready campaign clearly resembles Intel Corp’s own ‘Intel Inside’ campaign although 3Com maintains that it will offer its partners greater flexibility. As Intel has done, 3Com is backing the Network Ready program with a range of financial incentives for its partners. 3Com says it will spend $1.7m a quarter on advertising and other promotional material to get the Network Ready logo and the company name recognized. In addition, it will also provide funding for partners own promotions including the Network Ready logo, depending upon volume of sales.
