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Entrepreneurial Capitalism and Innovation:
A History of Computer Communications 1968-1988
By James Pelkey

Entrepreneurial Capitalism & Innovation:
A
History of Computer Communications
1968 -1988
By James Pelkey

This history is organized by three co-evolving market sectors and also standards making.
An overview of the schema is presented in the Introduction.

DATA COMMUNICATON
Ch. 1: Emergence
Ch. 3: Competition
Ch. 5: Market Order
Ch. 11: Adaptation

NETWORKING
Ch. 2: Vision
Ch. 4: Arpanet
Ch. 6: Diffusion
Ch. 7: Emergence
Ch 8: Completion
Ch. 10: Market Order

STANDARDS
Ch. 9: Creation

INTERNETWORKING
Ch. 12: Emergence

 

 

Chapter 11
Data Communications: WANs 1979-1986
Data Networks Become Wide Area Network

 

11.7   Timeplex

In December 1983. Timeplex entered the T-1 multiplexer market with the announcement of its Link/1. Making three-node networks possible, not just point-to-point connections, the Link/1 represented a first step towards a networking T-1 multiplexer. In addition, each Link/1 could support five T-1 circuits compared to just one per each Megamux, a significant competitive advantage. Smith of GDC remembers:

“Timeplex could build a triangle network: three point network, interconnect with three muxes, and we had to take six because we had two per link to do it. So they got the real jump based on the networking marketplace.”

Like GDC, Timeplex sold a full line of data communication products, albeit OEMing its modems from Universal Data Systems (dial-up modems) and Paradyne (lease-line modems). Technology never was considered Timeplex’s strength: Rather it was known for its aggressive marketing and sales organization. The Link/1, for example, did not even offer networking reconfiguration capabilities equal to those of the GDC Megamux.[8] Nevertheless, in 1984, Timeplex seized a whopping 18% market share for T-1 multiplexers on the strength of its distribution network and strong ties with the RBOCs. (See Exhibit 11.4 Statistical and T-1 Multiplexer Sales 1984.) Timeplex, like the other early Data Communication companies, conceived T-1 multiplexers as products to save customers money by consolidating their data circuits and, only later, would they add voice support to their systems. Ed Botwinick, president of Timeplex, remembers:

“In the early '80s, we started developing the Link family because we saw it was going to be a networking market. Everybody said T-1s are very expensive, so nobody's going to have very many of them. I said:  "I don't care how expensive they are, if you fill them up, they may represent a major saving in terms of getting rid of lower speed lines. Communications needs are going up and we're going to put voice on these things."

In 1985, Timeplex displaced GDC as the leading T-1 multiplexer vendor, capturing nearly one-third of the $158 million market with sales of $48 million. In doing so, the Link/1 comprised an astonishing 40% of Timeplex’s sales.

Exhibit 11.4
Statistical and T-1 Multiplexer Sales - 1984

($ Millions)

 

Statistical
Multiplexer
Revenue

Percent
Market
Share

T-1
Multiplexer
Revenue

Percent
Market
Share

Total
Multiplexer
Revenue

Timeplex

40

16.7

11.3

17.9

51.3

Codex

50

20.9

 

 

50

GDC

25

10.5

24.0

37.9

49

Micom

47

19.7

 

 

47

Infotron

40

16.7

 

 

40

Others

12

5.0

28.0

44.2

40

Total

239

100.0

63.3

100.0

302.3

 


[8]   Ibid., p. 129