3Com Struggles -- Should Small and Midsize Businesses Bolt?3Com Struggles -- Should Small and Midsize Businesses Bolt?

Bruce Claflin, a company veteran, guided the firm through many of these changes. At the start of 2006, he announced his retirement, which triggered a volatile period for 3Com. Rejoining the company after a stint as venture capitalist, Scott Murray held the CEO position for only seven months. He claimed that managing a partnership with Chinese equipment vendor Huawei Technologies consumed too much of his time commitment, and he wanted to spend more time with his family. Edgar Masi rejoined 3Com in August 2006 after working with startup Redline Communications, and one of his first moves was buying out Huawei's stake in the joint venture, dubbed H3C Technologies. Ironically, Huawei has teamed with Bain and now has taken a minority stake in 3Com.

So what's next for 3Com? The company's long-term strategy could be similar to that of traditional rival Avaya, which also went the private route earlier this year. Silver Lake Partners and the Texas Pacific Group financed the move with the goal of de-emphasizing Avaya's networking hardware and focusing on software to keep the company afloat. 3Com has some VoIP software, but its portfolio doesn't seem to be as deep as Avaya's.

Another option for 3Com is to become a low-cost producer of network hardware. Increasingly, Asian companies are manufacturing IT equipment, and Huawei's stake and input could grow over time. In this case, 3Com's long-term plan may be to go after the low end of the market, expand its presence in international markets, and make a play for the emerging WiMAX WAN equipment segment.

None of the options bode well for small and midsize businesses, which have helped 3Com stay afloat during the last few years. These customers will probably soon find their requirements moving lower and lower on the company's priority list. So, they face a difficult decision: Stick with 3Com a while longer and hope the company rights itself, or dump the company and its equipment. The latter may be the better option. 3Com has already abandoned its high-end enterprise users and hasn't been able to build a viable business with its focus on small and midsize enterprises. Given its helter-skelter recent history, there's little reason to think that the company is firmly embedded in this, or any, market segment.

Do you have 3Com equipment? How confident are you about the company's plans to take itself private? What course do you expect them to follow in the future?

Paul Korzeniowski is a freelance writer who has been writing about networking issues for two decades. His work has appeared in "Business 2.0," "Entrepreneur," "Investors Business Daily," "Newsweek," and "information." He's based in Sudbury, Mass., and can be reached at [email protected].