At a National Sales Meeting in 1996, a guy named Burk (he'll show up again in this story later) stood up in front of the entire PCD sales and marketing organization and worked his way through a slide presentation about a new technology, code name "ARCTIC." It was absolutely imperative, he said, that no one in this room breathe a word of this to anyone. We had gotten our hands on a technology, he said, that was going to allow us to double the speed of internet connections -- to achieve 56K on an analog phone line.
Yeah, I know. From your seat at the gigabit ethernet workstation in 2012, you're not impressed. But if you have been around long enough to remember, you remember that this was a very big deal.
We later decided that ARCTIC stood for "a really cool technology, introduced Christmas," that being the time frame when we were likely to be ready to go to market with it.
Looking back on it, I don't know if everyone in the company was as excited about it as I was. I'm prone to passion -- when you tell me it's a big deal, I tend to believe you. And it was pretty clear that we had the jump on our competitors with this, and that we had a unique capacity to deliver it that most of our competitors couldn't touch.
You see, in order for 56K technology to work, the modem you talk to with your modem must also speak 56K. And the technology to do that at this point was proprietary. Buying a 56K modem for your computer wasn't going to help you unless your Internet Service Provider could speak the same 56K language. And unlike our competitors, we had an entire division (Corporate Systems, later renamed Network Systems) that built ISP head-end equipment. So odds were good that the modem your modem was calling was built by U.S. Robotics.
And the crowning glory was that this technology would, for most of the head-end equipment and even a handful of client-side equipment (client-side being you, the average individual customer) would be "flash upgradable" -- no new hardware required.
At the time of this meeting, we had all arrived there feeling a little discouraged. The modem was becoming commoditized, and we'd said everything there was to say about it that was interesting. The market was softening and it was tough to defend the premium price we were asking in the retail marketplace. (U.S. Robotics modems were the most expensive on the shelf. We built them in Skokie, Illinois, USA, and we paid for a ton of independent lab testing and quality assurance work that our competitors tended not to bother with.)
Needless to say, this rekindled the fire in a big way. We couldn't talk about 56K, but we could talk about current products that were flash-upgradable, and we could talk about the "end-to-end solution" that meant you and your ISP were using the same brand of modem. If it's good enough for your ISP, then it must be pretty good, right?
We came out of that meeting ready to conquer the world, understanding exactly what we would need to do to become utterly dominant in the modem marketplace. Our goal was a clean, world-changing launch of ARCTIC in time for the holiday shopping season, and from there, we were shooting for 60% market share.
Next up: The ARCTIC Summer