Valley Wonk: Marvell Ascending
Look at it this way: Marvell is growing magnificently, but it's not as if they took over the Intel Corp. (Nasdaq: INTC) museum, or kicked Cisco Systems Inc. (Nasdaq: CSCO) out of its sprawl of cookie-cutter buildings. The 3Com Building is hardly Silicon Valley's Transamerica Pyramid.
Part of my problem is that I rarely see the building. It's visible from a busy stretch of Highway 237, but I rarely have to drive that way. For all I know, Marvell could have painted the building purple and pink and put an inflatable clown's head on the roof.
But yeah, there's some significance. It's a sign of turnover in the Valley's pecking order, with Marvell climbing and 3Com still kicking but certainly faded.
Marvell spent the last few years working up the Wall Street ranks, going from Best Kept Secret to Analysts' Darling. The company produced quarter after quarter of profits even during the downturn, and its accomplishments were recognized last month with three awards at the annual bash held by the Global Semiconductor Alliance .
3Com, meanwhile, got pummeled by Cisco, then got pummeled by Cisco some more, then teamed up with Huawei Technologies Co. Ltd. in an apparent attempt to get pummeled by Cisco again. (OK, I'm taking some poetic license – toss an Intel pummeling in there somewhere as well.)
What's interesting is that the two companies seem so different in personality to me. Marvell is reportedly a difficult place to work. Word is that the hours are long, the pressure high, the praise and perks few. For those whose passion is their work, it might be exhilarating, but it sounds stressful even by Silicon Valley standards. That many of Marvell's spokespeople and marketing types have come and gone several times during the past few years – even while Marvell was going gangbusters – has to mean something.
My first impression of 3Com was miles away from that. Although I never covered the company deeply, I did get to meet CEO Eric Benhamou, at a press and analyst dinner held at his house. Quite a nice house, as you'd imagine, with a backyard big enough for a few dozen of us to dine.
I was a brand new reporter then. I didn't quite know what all these "analysts" did and had barely worked out the routine that goes on between PR and news (my previous beat, real estate, didn't unleash the PR armies the way tech does.) It turned out the evening was meant as a social gathering, a chance to meet with folks you saw on the circuit all year but never got to really know. Months later, I would experience the horrors of Comdex and realize how rare an opportunity this was – not as a networking event, but as a chance to breathe.
The impression I got was that Benhamou was a nice guy. I should add that he's now chairman of Cypress Semiconductor Corp. (NYSE: CY), sitting above prickly CEO T.J. Rodgers, so it's not as if he's helpless or thin-skinned. But if I could pick an opposite for Marvell's rep, that first 3Com meeting would be in the running, at least in my limited view.
Marvell's obsessive personality drove its success, but there's a larger issue afoot: the rise of components. The piece-parts are where the tech magic happens, and chip companies in particular have spent the past decade taking over.
You've seen it in the disassembling of vertically integrated companies – Motorola Inc. (NYSE: MOT) setting free its chips division as Freescale Semiconductor Inc. ; or, more recently, Agilent Technologies Inc. (NYSE: A) selling off semiconductors to form Avago Technologies Pte. The more obvious example is in the PC, where it's Intel – and, increasingly, Advanced Micro Devices Inc. (NYSE: AMD) – that counts, rather than the logo that says Dell Technologies (Nasdaq: DELL) or Gateway Inc. or International House of PCs.
So it's fitting that as a once-prominent systems company moves out of an HQ, someone like Marvell steps in. Guess I'll have to drive by someday and see what color they've painted it.
— Craig Matsumoto, Senior Editor, Light Reading