American History 1988
Chapter 119 - 113: Ripples

Chapter 119: Chapter 113: Ripples

December 20, the last working week before Christmas and the tail end of the 1980s.

On this day in California, the festive atmosphere was visibly dense, with Christmas trees, Santa Claus costumes, and long stockings prominently displayed in shop windows.

The supermarkets were also packed with adults pushing shopping carts, selecting Christmas gifts. Children had been looking forward to this holiday for a month, and no matter how the year had gone, they at least deserved a happy Christmas.

Bob Metcalfe had the same intention, although he was now the esteemed founder and director of 3COM, he still planned to personally choose the Christmas gifts for his children.

But before that, he needed to complete his last piece of work on the last working day of the year, having lunch with venture capitalists from Mayfield.

To be honest, Metcalfe did not like those profit-driven venture capitalists, especially during the financing stage of 3COM. Investors from the West Coast fiercely drove down prices, while those from the East Coast gave him the runaround.

However, after 3COM’s successful IPO, while Metcalfe reaped substantial rewards, he also gradually formed the habit of having lunch with investors once a week.

Although those guys were annoying, it had to be said that they were very well-informed, and Metcalfe always managed to get the latest insider information from them.

Whether it was about competitors, entertainment gossip, or political scandals, these venture capitalists had noses more sensitive than dogs.

After grooming his thick, auburn hair and beard in the mirror, and slipping into his beloved loafers, Metcalfe was very satisfied with his "Viking" image.

He made no secret of his Nordic heritage, even branding himself as an "American Viking" and a "right-wing hippie."

All of this was to show the media a personal style unique to Metcalfe, similar to Jobs’s "exceptionality."

In Silicon Valley, a successful company founder needs to have their own marketing image. Some choose the label of "nerd," while others strive to create a charismatic personality.

After a series of struggles through financing, venture capitalists, and going public, Metcalfe was no longer the idealistic engineer obsessed with technology.

"Wally, you are the last partner I’m having lunch with before I board my Christmas holiday flight," Metcalfe said as he walked straight to their usual spot in an Italian restaurant in Mountain View.

"I suppose I should feel honored, Bob," Wally Davis said as he put down the magazine in his hand and stood up to give Metcalfe a warm hug.

"How are things going, buddy? Can you withstand Cisco’s offensive? I don’t want Valentine to boast about his unique insight in front of me every time."

Wally Davis was a senior partner at Mayfield Venture Capital and the first person to write a check for Metcalfe during 3Com’s fundraising.

"I concede that their products have their merits, but 3Com is the inventor of Ethernet; we have the first-mover advantage," Metcalfe said confidently after sitting down, "Cisco hasn’t even gone public yet; they are at least a Silicon Valley away from us."

"You’re always this confident, Bob. But don’t underestimate them, Cisco will go public in the second quarter of next year. Then they will gain enough financial support."

As a venture capitalist, Wally had a keener sense of market trends. He pretty much knew everything about Cisco’s IPO plans; at least five major institutions were underwriting their stock.

Cisco, not yet public, had already put pressure on 3Com in the router market.

If their fundraising was successful, whether it was in research and development or management and operations, there would inevitably be significant progress. At that time, 3Com would be facing a much stronger Cisco.

Obviously, Metcalfe understood this principle, but he had to give his investors enough confidence. "Wally, 3Com is about to launch a new generation of high-end routers; we won’t give Cisco any chance to exploit.

In addition, our R&D team is also developing more types of Ethernet adapters, which will help us expand our range of business."

"I hope so, you know, Bob, the market is watching us. If you don’t want 3Com’s stock to plummet, then you need to take real action, even just a signal is better than doing nothing."

Wally didn’t care about 3Com’s R&D; he was only interested in its stock. The stock lock-up agreement that Mayfield had signed with 3Com was about to expire.

If things looked grim, the first to abandon Metcalfe would definitely be the Wally Davis sitting opposite him now.

Actually, 3Com’s start-up products were network switches and various Ethernet adapters, but as more and more private networks emerged, now the router market had become increasingly dominant.

Especially in the high-end router market, with its substantial profits, mainly serving super-groups like government departments, railway systems, postal systems, and civil aviation systems.

So, even though 3Com had no ace up its sleeve in the router field, both Metcalfe and the venture capital institutions behind him were unwilling to forsake this lucrative business.

But Metcalfe knew that Cisco would pose a great threat to 3Com in the router sector. Yet, he could only watch Cisco grow stronger and was unable to do anything about it.

Feeling frustrated and agitated, Metcalfe suddenly lost his taste for his beloved Italian coffee; his gaze wandered and then he was drawn to the magazine lying in front of Wally.

"’Global Overview’? Have they released a new issue?" Metcalfe showed interest, as he was also a fan of this magazine.

Wally flipped over the magazine, revealing a cover designed with a Christmas theme. "It’s their Christmas special edition; this issue mainly provides a roundup of products and companies that have emerged over the last year."

Wally was a reader of "Global Overview" too, a magazine that focused on the technology industry and was written in easy-to-understand language, which was perfect for venture capitalists like them who had only a rudimentary understanding of technology.

Seeing Metcalfe’s interested gaze, Wally pushed the magazine towards him, perhaps hoping the other could provide some insights into the technical prospects.

Metcalfe, upon receiving the magazine, was immediately drawn to the large "Teams" title on the cover.

Below the title were scattered, minimalist cartoons of businessmen in suits and ties, which from their interactions, appeared to belong to the same organization. What was more eye-catching were the chat boxes linking all the individuals above their heads.

Text messages and call logs filled most of the chat box, with the logo of Teams highly prominent at the top of the page.

The cover of "Global Overview" was mostly dedicated to it, ensuring that no one who saw the magazine could ignore its content.

"Revolutionary instant messaging software? A new frontier in the office software domain?"

"A chat software that emphasizes instant messaging, I find it a bit overhyped," said Wally, nonchalantly cutting into his steak with knife and fork.

"With the free Plato System available, why should I pay? And as for the much-hyped voice communication feature, internal phone calls are also free, so why should I pay for that too?"

Wally laid down his knife and fork in exasperation. "Who came up with this idiotic idea? I’m sure they’re just trying to swindle investors’ money!"

Listening to Wally’s complaints, Metcalfe didn’t rush to a conclusion. He had a doctorate in engineering and had a technical background.

What seemed trivial to Wally often needed strong technical support as a foundation.

Metcalfe turned to the article about the Teams software on the front color pages of "Global Overview."

The opening section about instant text messaging didn’t impress Metcalfe much, since the Plato System already existed.

Although Teams had made improvements, they were merely minor design tweaks. But the content that followed caught Metcalfe’s attention.

"The amazing file transfer feature, to some extent, has even replaced the need for emails and floppy disks. Can you imagine copying a spreadsheet directly into the chat box, and then, like sending text messages, sending it to someone else?

It’s all as simple as the operations we perform while using Word. I’m amazed at the extremely simple operation of this software. My wife, who is almost completely computer illiterate, managed to make a successful voice call without asking for my help.

My God, if all software could be designed this simply, then any ordinary person without a relevant background could become a competent engineer.

Oh yes, speaking of voice calls, this is a revolutionary design. For the first time, humans have used a computer to communicate through voice without relying on phones.

While it currently has many limitations, I believe this is a revolutionary step. In the future, this kind of internet-based voice calling technology is bound to surprise everyone.

Lastly, a little personal discovery: with the aid of specific hardware, Teams can help you engage in unlimited-duration voice chats with friends for free."

What followed was the magazine writer explaining how to set up a private network and then use Teams to establish a connection, scientific knowledge that only electronic enthusiasts would comprehend. Of course, the readers of "Global Overview" were tech enthusiasts themselves, so this was probably not a problem for them.

Next to the image of the Teams software, there were also contact details for Byte software and the address of an electronics store. This was part of the product directory of "Global Overview," where the editorial team would review each product and then provide the contact information of the vendors.

Of course, that electronics store called "Computer Boutique" was a creation of the magazine’s editor-in-chief, euphemistically called the exclusive physical retailer for the software.

In a sense, it also served as a form of advertising, with Dean’s ten thousand US dollars mostly reflected on the cover and the front color pages.

After reading about Teams, Metcalfe’s reaction was the complete opposite of Wally’s; he became very interested in this instant messaging software.

"Wally, I want to give it a try," Metcalfe pointed at the cover of "Global Overview" and said.

"What?" Wally thought he had misheard, as he saw no market potential for the software.

"My intuition tells me that it could possibly relate to 3Com. But I’m not sure, so I want to try it out." Software combined with hardware was already forming a vague concept in Metcalfe’s mind.