Procket wins contract, loses people

On the heels of landing its largest customer, Procket Networks Inc. has lost its COO and perhaps its founder and chief scientist, Tony Li.

Procket this week bested Cisco Systems Inc. and Juniper Networks Inc. for a multimillion-dollar deal with AARNet, which operates Australia’s Research and Education Network. AARNet is installing 12 Procket PRO/8812 and PRO/8801 routers for its worldwide network build-out supporting 37 Australian universities and other scientific and industrial research organizations, and over 800,000 end users.

But the five-year-old, privately held company also lost chief operating officer Vito Palermo, who resigned to pursue other career opportunities, according to Cary Hayward, Procket’s director of marketing. Palermo became Procket’s COO after the June departure of CEO Randall Kruep.

Palermo may have had his sights set on the CEO seat at Procket. He was passed over, however, when former Cisco executive Roland Acra was named Procket president and CEO earlier this year. Hayward would not comment when asked if Palermo was seeking or considered to fill the CEO vacancy.

Another significant vacancy at Procket may open up when chief scientist Tony Li wraps up his customer support work at AARNet. Li reportedly gave notice at Procket this week with a note to employees that stated he would be leaving the company after his “tour of duty” in Australia is up.

“I do not like letting you down, but the alternative to doing so is far worse,” the note reportedly stated. “There are some things that a man has to do if he wants to retain his basic ethics and morals.”

Hayward said Li is still employed at Procket and confirmed that he is in Australia supporting the AARNet installation. He did not deny receipt of the note, but he also did not explain what Li was referring to in the note, saying it was a “personnel issue we don’t discuss externally.”

Li is renowned throughout the industry for his technical contributions and his flair for the dramatic. He co-authored the BGP4 protocol, the workhorse of the Internet backbone; and designed Cisco’s 12000 series routers and Juniper’s M- series routers.

He also reportedly nailed his Cisco resignation letter to a door, clashed with Juniper CEO Scott Kriens before leaving Juniper, and clashed with Procket CEO Kruep before Kruep left.

Rather than replacing Palermo or Li, Hayward says Procket’s near-term priorities are driving more sales and lining up channel, distribution and OEM partnerships. Asked if Procket is for sale and shopping itself around — Cisco is rumored to be eyeing the company as the delay in its next-generation “HFR” router lengthens — Hayward said: “We’re in the mode of building a solid business right now. A whole bunch of good exit strategies come from that.”

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