Greg Enright: Honesty trend could catch on

It was more than a little interesting to read some well-buried words in Microcell Telecommunications Inc.’s release of Aug. 9 announcing its quarterly results. Canada’s fourth-largest wireless provider admitted that it may not be able to avoid defaulting on its long-term debt agreements. As a result of that fact, Microcell said “there is significant uncertainty regarding the company’s ability to continue as a going concern.”

It’s not often that you hear an outfit the size of Microcell admitting that its financial situation is so bleak that its future existence is questionable. Such an outburst of honesty, even if its inclusion was ultimately related only to keeping share prices as high as possible, was startling and, dare I say, somewhat refreshing in these dark days of WorldCom, Quest et al.

Those words are examined in an article on page one of this issue. On page three, there are more admissions by a significantly sized company that all is not well in the networking/telecom space. They were offered by 3Com CEO Bruce Claflin, who had no trouble in resigning himself to the fact that 3Com’s network interface card business and its CommWorks wireless equipment arm are in decline and probably won’t see an upswing again.

In fact, Claflin’s whole tone throughout the interview is a no-nonsense, get-to-the-point one that also smacked of a refreshing scent in an environment nearly filled to capacity with hollow posturing.

It’s difficult to say that isolated statements from two networking firms constitute any kind of a trend, but it’s safe to say that such a high volume of openness was rarely witnessed during the heady days of 1999 and 2000. At that time, while the networking and telecom industries were ascending their steep upswing curves, anything seemed possible. With venture capitalists throwing their wallets at any geek with a briefcase and a three-page business plan, anything did indeed seem possible.

As a result, many of the comments coming from vendors, large and small, about their businesses were brimming with optimism – and, unfortunately, little practicality. Sure, there were level-headed assertions being made by equipment builders and service providers, but they were drowned out by the hot air that was artificially inflating the industry’s balloon.

Today, with little or no hype to hide behind, practical statements such as Claflin’s are fortunately being exposed. After months of negative financial news and scandal upon scandal, this sector has taken a beating. It’s a surly beast with no time for niceties. It would not be surprising if in the months ahead we hear more statements like the ones filling the pages of this issue. Thanks largely to the WorldCom blowup and a multitude of unfulfilled vendor promises, today’s network manager is more skeptical of empty claims than ever before. The vendors who will succeed in such a climate will respond as Claflin seems to be: honestly.