Modem market decline claims another victim

Modem market decline claims another victim

BRISBANE - Bowing to the inevitable, veteran Brisbane modem distributor and reseller Computer Hand Holding has gone into liquidation.

The evolution of modems into commodity items and resultant "pathetic margins at all levels" were blamed by director Michael Richardson for the decision to roll down the shutters on the seven-year-old company.

Past its peak

Margins dropped to a third of their levels of a few years ago and the sector is past its peak with profits and unit sales both declining rapidly, Richardson said.

Any company concentrating on modems faces "bad times over the next three years", he predicted.

Nor can they expect the uptake of the 56Kbit/sec generation of modems to produce much more than a minor sales bubble, he said.

In place of Computer Hand Holding, Richardson and a new partner are launching a new, more diversified company, Silicon City, which will absorb most of Computer Hand Holding's five staff.

It will focus on personal computer solutions and value-added services, possibly selling Hewlett-Packard systems, with modems relegated to a secondary role.

Other cities

Richardson would not name his partner in the venture beyond identifying it as a Canberra manufacturer of computer peripherals.

Computer Hand Holding originally was allied with Maestro but later expanded its repertoire to include Banksia, Netcomm and US Robotics.

The first Silicon City outlet will open this month in Brisbane and the partnership is planning other stores in Melbourne and Sydney, Richardson said.

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