Another reason Nortel should stick to voice

Last weekend, I moved into a new apartment and wondered how I could use the experience to write a work-related blog.

Thenthe Rogers cable guy installed my home phone service and I plugged in aphone I hadn't used in a while. I had bought it from an electronicsurplus store near the Chum City building in Toronto during the early90s. At the time, I considered this device to be leading-edge becauseit was Touch Tone. The manufacturer’s label? Northern Telecom.

Tenyears ago, Northern Telecom changed its name to Nortel Networks Corp.because the company had boughtBay Networks for $9 billion and was starting to compete withdata networking vendors such as Cisco Systems Inc. and Cabletron (nowknown as Enterasys). At the time, thinking of Nortel as a phone companywas like thinking of HP as a printer company.

Now that Nortel isoperating under bankruptcy protection, the company is planning to shedsome of its assets. On Thursday it announced a “stalking horse” agreementwith Tel Aviv-based Radware Ltd. to sell its application accelerationproducts, five application switches and the virtual servicesswitch 5500. This does not mean Radware will necessarily acquire theseproducts. A stalking horse offer refers to an attempt by a companyunder bankruptcy protection to maximize the value of its assets,meaning Nortel could sell the products to Radware if no one elsepresents a better offer and if the courts approve the sale.

What’ssignificant here is Nortel owns networking products in many differentareas, including contact center, Ethernet routing, SONET, opticalEthernet, wavelength division multiplexing, firewalls, intrusionprevention and wireless cards. Oh and by the way, it also sellsbusiness phones and PBXs – plus the cheap touch tone phone I bought onQueen Street West about 15 years ago. What’s significant is, this phonestill works and will probably last me into retirement (which hopefullywon't be forced upon me as a result of this blog post). Though it haspoured billions of dollars into acquisitions with questionable returns,one of Nortel’s most valuable assets is a recognized brand in voicecommunications. If the company is still around when I retire, I’mwilling to bet it will still be specializing in the same area in whichit started in 1895.

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Jim Love, Chief Content Officer, IT World Canada

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