Nortel announces enterprise strategy and products

Nortel Networks Corp. plans to unveil a marketing strategy Tuesday focusing on enterprise customers, a move designed to carry the networking provider beyond the still-dreary market for networking gear sold to telecom carriers.

The announcement will include important revisions to three IP telephony products, including a standards-based switch that provides power over Ethernet capabilities to compliant devices such as IP phones and wireless access points, according to Nortel officials.

The announcements come nearly a month after the Oct. 3 appointment of Oscar Rodriguez as president of the enterprise networks division at Brampton, Ont.-based Nortel.

The enterprise customer move and Rodriguez’s appointment show a new effort within Nortel to anticipate enterprise customer needs, analysts said.

“The service provider business Nortel once had is bad today and this announcement shows an increased commitment to the enterprise front,” said Mark Fabbi, an analyst at Gartner Inc. in Stamford, Conn. “They had ignored the enterprise for a while and there were even rumors a year ago they’d get rid of the enterprise focus. But that’s been put to bed.”

Gartner places Nortel in a broad category of networking leaders along with Cisco Systems Inc. and Avaya Inc., with Mitel Networks Corp., Alcatel SA, 3Com Corp. and Siemens AG trailing in terms of overall market success and innovation.

“The overall technology from Nortel is very solid,” Fabbi said.

Its new marketing emphasis should help the company convince more enterprise IT managers to buy its gear, despite recent news reports about drastic layoffs.

“Financially, Nortel is struggling, but they have a pretty decent cash position and with more focus on these enterprise areas, they will clearly survive and get back to break and cash-flow positive by next year,” Fabbi said.

Marie Hattar, director of Nortel enterprise marketing, said in an interview that the marketing focus will be on “providing superior service so that we know what the customer wants almost before they know what they want.”

She said networking vendors including Nortel have “tended to talk about speeds and feeds of products and don’t focus on end-user value.”

Hattar said Nortel will emphasize several themes important to enterprises: security, no matter what the device; convergence of technologies such as voice, video and data; networking management capabilities; built-in scalability; fail-safe capabilities: built-in applications for call centre and other products.

The power over Ethernet switch, called BayStack 460, will be available in January for US$3,495, said Tony Pereira, director of product marketing at Nortel. It is compliant with IEEE Power over Ethernet standard P802.3af, making it one of the first in that category, Fabbi said.

The other products are the Communication Server for Enterprise1000 IP Private Branch Exchange Version 2 , which allows more simultaneous calls and allows distribution over WANs and LANs. Pricing starts at US$625 per line.

The third product is a CallPilot Version 2, which combines 40 new features for call centre server integration, including the ability to unify messages such as e-mail and voice. It sells for US$100 to US$200 per client.