line, allowing modems based on them to sell at price points around $300, the point formerly held by 2400 bit/s models that offered no error correction or compression, nor fax capabilities. All of the 1st-tier companies had serious difficulties adapting to a market that was now filled with low-cost modems with similar or better performance and features than their own high-end models.

Telebit started slipping in terms of relative performance, while still trying to sell their products at their traditional high