BREAKING NEWS: Avaya announces Nortel product plans

Avaya Inc., which has completed its takeover of the enterprise assets of Nortel Networks Corp., is set to announce its product integration plans Tuesday.

One analyst who was briefed on the plans said customers should have little, if anything, to worry about.

I think they’re doing everything they can to make sure you’re not going to left out in the cold with a product they won’t support,” said Zeus Kerravala, senior vice-present at Yankee Group Research Inc. of Boston. “If you’re a  Nortel customer you will be able to take your products and migrate to them to a related Avaya product.”

Avaya is scheduled to announce its plans during a conference call at 11:00 a.m. Eastern.
The company issued some details in a press release.

Avaya said its IP Office, BCM, Norstar, Partner and Integral 5 “all remain for sale with a plan to converge the platforms to the company’s flagship hybrid IP offering, IP Office.”

It also plans to “adopt the current roadmap of (Nortel enterprise) data products in its entirety.”

Basking Ridge, N.J.-based Avaya announced in December  the federal government completed a review required under the Investment Canada Act. Avaya won an auction in September when it agreed to pay US$915 million for the Nortel units that make switches, routers, firewalls, virtual private networking (VPNs), unified communications, private branch exchanges (PBXs), phones and key systems.

Nortel, which has lost money nearly every year except 1998, filed for protection from creditors a year ago. It sold its carrier wireless assets – which make code division multiple access base stations for cellular carriers – to Telefonaktiebolaget LM Ericsson of Sweden for US$1.13 billion. That deal resulted in Ericsson hiring more than 900 former Nortel workers in Canada.

Industry Canada also approved the takeover of Nortel’s optical networking and metro Ethernet units by Ciena Corp.

The Avaya deal had some analysts worried that the company would not keep all Nortel and Avaya products, given the overlap in their voice products. With the Nortel acquisition, Avaya will now have switches and routers.

While Nortel had only five per cent market share in data networking it’s an $18 billion market,” Kerravala said. “It’s a lot of money. It looks like Avaya’s planning on keeping it all and supporting it all.”

The US$915 million Avaya is paying is comprised of US$900 million in cash to Avaya and US$15 million in “employee retention.”

Avaya, which is privately held by Silver Lake Partners, was born as a separate firm in 2000, when Lucent Technologies Inc. decided to spin off its enterprise unit. Lucent was formerly known at AT&T Bell Labs and merged with Alcatel SA of France in 2006.

Last year, Avaya hired Charlie Giancarlo, a former executive with Cisco Systems Inc., as its chief executive officer. He was replaced by Kevin Kennedy.

Earlier this year Avaya launched Aura, a Linux server designed to function as a communications server in a multi-vendor environment, using session initiation protocol (SIP).

“Aura was a product designed to be multiivendor where it would be the core and you could put products from other vendors around it,” Kerravala said.


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Jim Love, Chief Content Officer, IT World Canada

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