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Growing Linksys Moves Into Expanded Headquarters

Growing Linksys Moves Into Expanded Headquarters

Carlsbad’s Greenland Buys OC’s W3M; Odetics Unit Grabs Video Gear Maker Assets

TECHNOLOGY

by Andrew Simons

It is the best of times, it is well, the best of times, at Linksys Group Inc.

The seller of networking gear for the home and small businesses recently moved across Irvine to a new, larger building,effectively quadrupling the size of its facility.

“That will help us keep up with our growth,” said Karen Sohl, a spokeswoman for Linksys.

The company saw sales increase 75% in the past year to $360 million. This year, the company expects to grow revenue another 50% to 75%.

The sales growth also has meant more people. In 2001, Linksys grew its headcount by 20% to 300 people.

“We had no choice, we had to expand building space,” Linksys co-founder Victor Tsao said.

Linksys sells high-speed modems, hubs, routers and other devices designed to let home and small-business users easily string together multiple computers and printers. While Cisco Systems Inc. and other big-name networking companies that sell to businesses are struggling, Linksys says it still is seeing growth in consumer sales.

Linksys claims a 30% share of retail networking gear sales, Tsao said, with major stores such as CompUSA, Radio Shack, Wal-Mart and Staples carrying the company’s products. The most popular item, Tsao said, is Linksys’ broadband router.

Linksys has been somewhat of a fairy tale for Tsao and his wife, Janie, the company’s other co-founder. Nearly all of the Linksys’ production is done under contract in Taiwan,the homeland of the Tsaos. The two met while at Taipei’s Tamkang University. Both left comfortable computer systems jobs to start Linksys in 1988.

The Tsaos knowledge of the computer industry and their Taiwanese contacts were the basis of Linksys’ storybook garage beginnings. Now the company is looking at expanding production to China.

Yorba Linda’s Paradigm Bought

Carlsbad’s Greenland Corp. recently closed a $3 million deal to buy Yorba Linda-based W3M Inc. in a bid to expand services for its transaction processing business.

W3M, which does business as Paradigm Cabling Systems, does installation services for customers such as Verizon Communications Inc., SBC Communications Inc., United Parcel Service Inc. and the city of Irvine.

“Acquiring Paradigm as an internal profit center is a major step towards fulfilling our goal of building a solid infrastructure for Greenland’s transaction processing and software businesses,” said Chip Hyde, Greenland’s chief executive, in a statement.

Bringing Paradigm into the company will allow Greenland’s software development subsidiary, Check Central, to have better installation and management services for customers, the company said.

Greenland is taking out long-term debt, paid in installments for a three-year period, to buy W3M.

Iteris Buys Mil-Lektron Assets

Anaheim-based Iteris Inc. a unit of Odetics Inc., has acquired the assets of Palmdale portable video gear-maker Mil-Lektron, in-cluding product designs, inventory, intellectual property and the Mil-Lektron brand.

“Iteris has found the Mil-Lektron products to be highly complementary to our existing Vantage video detection and video surveillance offerings, and we expect the addition of the Mil-Lektron product line to help accelerate Vantage sales,” said Greg McKhann, Iteris vice president of roadway video systems. “Many Vantage users want to bring live video from the roadway to the desktop but have insufficient funding to install a fiber-optic infrastructure for video transmission.”

Rainbow Bits

Minneapolis-based Datakey Inc. and Irvine’s Rainbow Technologies Inc. recently announced they’ve joined together on a $1.2 million order to an international government agency for Rainbow’s iKey security product. The companies declined to specify which government made the purchase.

The order is expected to ship by the end of the quarter. Government employees will use the iKey to send e-mail securely.

Datakey and Rainbow’s relationship includes a reseller agreement where Datakey markets Rainbow iKeys to its customers. This is the first major sale under this agreement.

“Our iKey are making significant inroads with customers worldwide because they are easy to use and deploy, and deliver effective protection of a user’s digital identity for computer log-on, Web access, digital signing and secure e-mail,” said Shawn Abbott, president, Rainbow eSecurity. “We are pleased to work closely with Datakey on this new government customer contract to further advance the selection of this security form factor.”

The deal follows another government sale for Rainbow. Last month, Rainbow Mykotronx, a subsidiary, stuck a deal with the Department of Defense’s National Security Agency to provide security cards in the next three years for $33.6 million.

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