Compaq goes down Cisco route

Compaq is adopting Cisco's Internetworking Operating System (IOS) as the software core for its entry into the router hardware market. The company said last week it aimed to position the first product in the router line, the Netelligent 8500, as the lowest-cost router in its class.

Ian Whiting, manager of Compaq UK's networking products division, said Cisco IOS was chosen because it was a de facto standard, thanks to the company's large market penetration.

He said: 'We are not trying to replace corporate backbone routers, but to hook in on the edge of the network where price is important. These are routers for branch offices, and our use of industry-standard components such as Intel processors has reduced the cost per port without compromising performance.'

Compaq has reduced the price further by cutting its margins to around 22%, which the company claims makes the # 2,035 device around half the price of similar products from competitors including 3Com and Hewlett-Packard.

When Compaq bought NetWorth and Thomas Conrad last year, industry rumours suggested it would integrate its networking products into its server products.

Whiting said last week this strategy was not what customers want at present, although he did not rule it out in future.

'We are likely to see more convergence as the market develops, and there may be a case for integrating products like this into the server eventually.

But I think it will be into the next millennium before that happens.'