3Com Maps Retail Plan, Makes Cable Deals

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3Com Corp. made the first of what will likely be a series
of big moves over the next few weeks, smoothing out a retail-migration plan and readying a
large-scale deployment announcement with a major cable operator.

Last week, 3Com said it will provide high-speed-data
equipment to Susquehanna Cable and its sister company, "BlazeNet," an
Internet-service provider based in York, Pa.

3Com will work with retail outlets in the York area,
including Circuit City and Staples.

To the north, 3Com made similar moves last week with
Northern Cable in Sudbury, Ontario, agreeing to sell modems through smaller, independent
retailers, said William Markey, director of marketing for 3Com's cable-access unit.

"This is what everyone has been waiting for --
balance-sheet improvement through a migration toward the retail model," Markey said.

3Com's modems will sell for between $229 and $279,
Markey said.

Patricia Britton, vice president and general manager of
BlazeNet, said 3Com's U.S. Robotics Inc.-branded cable modem "signifies the next
generation of Internet access, a powerful brand and -- at last -- the retail-business
model."

She said BlazeNet will initially use a telco-return model,
"so that we don't have to wait for a rebuild of the entire system."

Markey said 3Com is also shining up a national database
that will reside in retail outlets as a kiosk display, so that customers shopping for
speed can find out whether or not two-way high-speed-data services are available in a
particular cabled area.

3Com will pursue retail modems in two phases:
"micro-retail," with an emphasis on outfitting small, independent retailers
"in even the tiniest hamlets"; and "near-national," when the retail
reach lengthens.

"We're in the micro-retail stage now,"
Markey said. "We're working with anyone on a point-to-point process."

Slowing the move to near-national selling is 3Com's
need for interoperability certification, he said.

"When we all get that gold sticker that says
'DOCSIS-compliant,'" Markey said -- referring to Data Over Cable
Service/Interoperability Specification, Cable Television Laboratories Inc.'s process
for ensuring that modems are truly interoperable and portable -- "that's when we
get to the next stage."

3Com's modems are in the process of becoming
DOCSIS-certified, and executives said any changes to the cable-modem specification can be
updated through a software download, and not a technician house call.

BlazeNet and Susquehanna said they will roll the data
service out in York, Hanover, Harrisburg, Hershey and Williamsport, Pa. Right now, the
high-speed-data service is only available in York, Britton said.

Another feature of 3Com's modems is what executives
called a 15-minute installation-time frame, because of their "plug-and-play"
configuration.

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