3Com restructures commercial arm again

In an attempt to put the network giant 3Com on a sounder financial foothold, the company has restructured its commercial business into two independent units.

3Com said the change in structure, which will begin at the start of its fiscal year on 4 June, is aimed at driving profitability and growth.

Bruce Claflin, 3Com chief executive, said the company would now have three dedicated units. "Today's action is another step on the path to profitability and growth," he said. "It puts the responsibility for the business in the hands of the people on the front line."

3Com will set up the 3Com Business Connectivity Company and the 3Com Business Networking Company. Following the restructuring, 3Com will have three business units with its CommWorks, which builds IP networks for network service providers.

The Business Connectivity Company will focus on business customers that are served by PC OEMs, distributors and other channel partners with high-volume, high-performance connectivity products for desktop, mobile and server PCs. This includes Gigabit Ethernet access and wireless connectivity products.

The Business Networks Company will serve businesses of all sizes with LAN switching, wireless infrastructure and IP PBX voice solutions. The new unit will sell through 3Com's traditional channels of worldwide resellers as well as emerging service provider channels.

According to 3Com, the restructuring will allow each unit to pursue more aggressive strategies and more quickly deliver competitive products. Each unit will be smaller and more agile and will be independent and able to pursue strategic partnerships.

Just last month, 3Com said it would make another 170 job cuts following poor third quarter results. This followed the 1200 announced in February. It is hoped these job cuts will save the company $18m a year.

3Com also pulled the plug on its consumer electronic devices, including its flagship Audrey web appliance and its Kerbango online radio service.