Michel Mayer is trying to make IBM's Networking Hardware Division (NHD) synonymous with Ethernet and IP-no small task as the division has in years past spent so much effort in pumping out proprietary products like SNA. Last April, Mayer, a 15 year IBM veteran, became the general manager of NHD, one of several executives to occupy that position during the past 16 months. Previously, Mayer was head of NHD's research and development arm. Before that, he headed NHD's labs in La Gaude, France. This past week, senior writer Marc Songini took some time to discuss NHD's ever changing role in the networking marketplace.
Q. We've heard a lot about NHD's revamping itself. So what is really new?
A. There has been a significant revamping of the product line. We wanted to make sure that we were participating in the networking marketplace at a level I believe IBM should be on. We've decided to expand our efforts to sell our technology and OEM it out to give us two things: create a growth engine that will go beyond the market share we have for our products and enable us to continue to be at the forefront of communications technology. It's consistent with theoverall direction of IBM.
Q.Can you talk about your OEM strategy?
A. It's a mix of things. We have been selling elements of technology for few years, like switching components. The Prizma [switching fabric chip) has been working quite a while. Rainier [an upcoming product] is a first generation network processor with more than 5 million gates, which is pretty large The value of those processors clearly is going to be more and more important.
Q. With the OEM focus, will NHD become a niche player in networking?
A. We will not be a niche player. We intend to have dual growth [for OEM and IBM branded products].
I think we have done good work revamping our product line. We'll still be shipping a lot of new IBM developed products. In those new categories [IP and Ethernet products] we're growing faster than the market. We're small, but I think we're successful.
We're going to be in a position to enable e-business for enterprises. This is our focus. We've always been an enterprise networking company -- we are not a telco infrastructure company. We never were. Our roll is to focus at the edge of an enterprise.
We have a set of very specific solutions we're focused on: server access, policy and security management and campus switching. I believe we have a role to play, you can call that a niche, I call it a focus. We'll focus on enterprise networking for large and medium business where there is value to add, while other people are fighting to move SS7 technology. We are not going to IP over SONET optical networking switches. That is not our battle.
Q. NHD has seen a lot of top management leave in the past 16 months. Is that a problem?
A. I think it's something that hasn't had an impact on operations beyond the perception.
Q. What do you intend to do to try to change NHD's image as a follower, rather than a leader in networking?
A. We will not [just]try. Again and again we will relentlessly push good products. There is no miracle here. It will come with time and effort and good engineering ... I also believe the OEM push is probably going to help our image a lot. It's going to legitimize our technology. NHD always been on the forefront. With IBM networking you also have to look to think Tivoli, and the Networking Software Division and e-business.
Q. Some analysts believe you've lost a lot of your sales force. Is that a problem?
A. I believe you have to look overall at IBM and so our sales force is much bigger than just NHD's. I believe we have the right number, in line with our revenue, according to the industry ratio.
Q. Is your significance greater in other parts of the world than it is in North America?
A. I think we are still significant in North America, but I would agree we've been more successful over the past two years outside North America which is the sign of a truly global business.
Q. Have NHD revenues shrunk over the past several years?
A. The revenues are about the same. But the important part is that we're getting more revenue with new products, such as IP and Ethernet, than with legacy ones. We think we're accomplishing our goals, but I am not satisfied with our share in the industry at this point. I believe we deserve much more.
Q. Will you be different than your predecessors?
A. I believe that on one hand there is clear continuity with my predecessors. On the other hand, I believe I am bringing a clear vision of what we can do in the networking industry. I also bring a different accent.
RELATED LINKS
Little IBM chip fuels faster gear
IBM reshuffles management
NHD reorganization. Network World Fusion, 4/6/99.
