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Chapter 10 - Networking: Market Competition 1981-1983

10.13 Interlan

Interlan exemplified the quick-to-market advantages of a start-up. They introduced their first Ethernet boards in January 1982, just six months after incorporation. They soon discovered that their products were slower than the Ethernet boards of 3Com as a result of using the Zilog Z-80 microprocessor. Paul Severino remembers:

What happened to us is when we found that the Z‑80 didn’t go as fast as we wanted it to, and we didn’t have a lot of time to figure that out because we were so fast getting to market, that there was a little hiatus there where 3‑Com gained some ground. Our board was slower until we changed it tow a bit slice [microprocessor] in July. Then we really had them sort of on the run.

Interlan didn’t initially offer any networking protocols. But in 1982 they decided on XNS, for reasons very similar to those argued within Ungermann-Bass. Severino remembers:

Once we had the hardware out, we basically wanted to make a decision about what protocol we were going to support, and there were a choice of two, XNS or TCPIP. We were looking for protocols that had certain characteristics that were efficient, that could be made to go fast. So we picked XNS, along with Ungermann-Bass and Bridge and 3‑Com and everybody else in the field, because if you looked at the two protocols from a technical point of view, XNS was designed for Ethernet, and TCP was designed for big wide area communications systems and had lots of overhead to it.

Interlan had a great first year. 1982 sales were $2.4 million with a loss of $1.1 million.