3Com Adds H3C High Capacity Switch to Its Enterprise Portfolio

| May 11, 2009 | Enterprise Network Systems | Competitive Intelligence Report

| Analyst: Bill Terrill

Current Perspective: Positive
Vendor Importance: Moderate
Market Impact: Moderate

Event Summary

May 11, 2009 – 3Com announced the H3C S12500 data center aggregation and high-end enterprise core switch which delivers 2.2 billion packets per second of forwarding through a 6.6 Terabits per second non-blocking fabric, with up to 128 10 Gigabit or 864 Gigabit Ethernet non-blocking ports (or 512 oversubscribed 10G ports). The H3C Intelligent Management Center provides single-pane management of the entire heterogeneous network infrastructure and integrates with existing systems.

Analytical Summary

• Current Perspective: Positive on 3Com’s release of its new enterprise high capacity switches, the H3C S12500 family, because this new switch places the 3Com’s H3C portfolio in a more competitive position when compared to its rivals. This new switch can be offered to data centers requiring either high density or high performance, or a combination of the two. With this product in the portfolio 3Com extends its full range of enterprise networks switches into the very top tier. 3Com also introduced a new management platform, the H3C Intelligent Management Center (IMC) for a single-pane view across the network infrastructure.

• Vendor Importance: Moderate to 3Com, because it was already offering its 3Com Switch 8800 in the high capacity switch router market and was reasonably competitive and the new product is, effectively, an upgrade to the product line. With the H3C S12500 introduction, 3Com does two things with one new switch - it has a hardware solution that is competitive with the latest top-of-the-line switches from its rivals, and it introduces its H3C division as the product name for enterprise focused marketing within North America. The latter should help 3Com differentiate its consumer and enterprise products going forward.

• Market Impact: Moderate on the enterprise high capacity switch router market, because 3Com is showing the competition that it is serious about competing at all levels in the enterprise network infrastructure. 3Com has consistently underpriced the competition with its enterprise products and, with a clear focus on all enterprise data center clients, 3Com and the H3C portfolio will now need to be taken seriously by all. Given that this new H3C S12500 provides density and performance similar to products from other top vendors, including the most recent announced units, all vendors in this space will need to be rethinking their strategies in regards to 3Com and its H3C product line.

Recommended Competitor Actions

• Most of the key vendors in the enterprise network space have high end products that can compete with the H3C S12500. However, these vendors must be aware of 3Com’s focus on lower cost products and be prepared to compete for the customers going forward.

• With the new crop of high capacity switches being offered, there is significantly less differentiation in performance or density than most vendors would hope for. This means that other features and functions will become the deciding factor for these products. Vendors, such as Cisco, Force10, Extreme, Enterasys, Brocade and such will now have to find additional methods to set their products apart. This can include touting a more complete product line, providing additional security options, or simply offering greater sales and support channels.

• All vendors should point out that the H3C Intelligent Management Center is new and untested. When working with their existing customers in bidding against 3Com, these vendors must stress that there is no reason to add a new level of complexity to the management structure.

• While of decreasing value, competitors can point to the fact that 3Com has, in the past, abandoned various markets including the enterprise switching market. They should point out that the H3C rebranding is aimed at attempting to hide the 3Com name from site so that customers will forget the past transgressions of the company. This may sow doubt about the long term plans of 3Com and, at least, cause the enterprise buyers to question 3Com on this point.

Recommended End User / Customer Actions

• 3Com with the H3C portfolio is a definite top-of-the-list for any enterprise looking to purchase enterprise data center networking equipment. It offers a full line of equipment, good prices, above average warranties, and worldwide service and support.

• The largest data centers should definitely consider this latest core switch as an alternative to other vendors. It provides performance, density and capabilities at or above those offered by competitive products. At the very least this product should be included in any RFP as a method to force other vendors to offer pricing or packaging incentives.

• An enterprise that has not yet standardized on a single network management package can consider the H3C Intelligent Management Center as an option. This has the advantage that it is new and was designed to support heterogeneous environments and includes support for ITIL and current compliance standards.

• Enterprises with an existing management platform should at least review the H3C Intelligent Management Center as an option. This may be especially useful for enterprises that have been using a single vendor’s management platform and are now moving to a more heterogeneous network. If a move to a new management platform needs to be made and 3Com/H3C devices are being added to the network, then this package should be considered.

• 3Com/H3C offers network products for all enterprise sizes. Even if the top-of-the-line switch isn’t required, 3Com should be on the list for consideration for any new networking installations. The company has gained a number three position (just behind HP ProCurve) due to its aggressive sales, pricing and product offerings. Take advantage of the opportunity to evaluate the H3C product line as an alternative to Cisco and other vendors.

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

Recommended Vendor Actions

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