SynOptics

» see synoptics.com as it lived, on the wayback machine

~ the goodbye ~

SynOptics was incorporated in 1985 by Andrew Ludwick and Ronald Schmidt, who had met at Xerox PARC. Ludwick's job there had been to find technologies worth commercializing and Schmidt had been working on Ethernet, including a fiber optic variant called Fibernet II. Xerox backed the spin-off. By June 1985 the two of them had enough money for twelve employees and a headquarters that was a trailer.

The first product shipped that year, a concentrator for Ethernet over fiber and over shielded twisted pair. The one that changed things came in 1987. LattisNet, originally called AstraNet, ran 10 megabits per second down the unshielded twisted pair already installed in office buildings for telephones, in a star topology back to a hub in a closet. In August 1987 an independent test house in New York confirmed it worked out to 330 feet from the wiring closet, and Novell reported it performing better than the RG-58U coax it replaced.

Until then, putting a computer network in a building meant pulling coaxial cable through it, and the coax was both expensive and structurally unforgiving. LattisNet removed the cable-pulling from the project. The revenue curve that followed is the clearest evidence of what that was worth. It was $1.8 million in 1986 and $40.1 million two years after that, and by 1993 it reached $700 million.

~ the chronicle ~

~ the patent dilemma ~

Xerox had filed a patent for SynOptics covering the hub architecture. On paper this was as strong a position as a hardware company can hold, because it would have kept anyone else from building an Ethernet hub at all. In 1987 HP proposed that the IEEE form a study group on standardizing Ethernet over telephone wiring, and SynOptics had to decide what to do with the patent.

One of its investors, Menlo Ventures, described the reasoning afterwards. The IEEE would not adopt a standard controlled by a single company, so holding the patent meant keeping exclusivity and watching the industry standardize on somebody else's approach instead. Releasing it meant free licenses for every competitor and a market many times larger.

SynOptics released it. The IEEE published 10BASE-T as 802.3i in 1990, and twisted-pair Ethernet became the way buildings are wired, which is still true thirty-six years later. LattisNet itself was not 10BASE-T; the voltages and signaling differed slightly, and the installed base had to be managed for years afterward. The 2500 series hubs only spoke LattisNet, while the 1000 and 3000 series took modules for either, with 505 cards for the old protocol and 508 cards for the standard.

Being the standard meant competing on price against everyone who had taken the free license. Cabletron came after SynOptics with heavy advertising and lower prices, with 3Com working the same accounts. By 1991 the share SynOptics held was down to roughly 40 percent, from something much closer to the whole thing. The revenue kept climbing anyway, because the market was growing faster than the share was falling, and that arrangement holds only while the market is still growing.

~ the wiring closet ~

The escape route was to move up the stack, from the hubs and repeaters that were becoming a commodity into routing, where the margins were. Rather than build that, SynOptics merged with Wellfleet Communications of Billerica, Massachusetts, announced on 6 July 1994 and completed that October in a deal valued at $2.7 billion. The result was Bay Networks, a company with two head offices on opposite coasts and neither name on the door. Nortel bought it four years later.

The physical legacy is easier to find than the corporate one. Every internet cafe I sat in between 2002 and 2005 had the same layout underneath the tables: one cable per machine, running back along the wall to a box in the corner with a row of blinking lights on it. Nobody thought of that as a design decision. It was just what a room full of computers looked like. That shape came out of a trailer in Santa Clara, where two people decided that the correct cable for a computer network was the one the building already had.

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