Despite Recent Woes, Nortel Opens New Office in Nigeria

In the scheme of things, Nortel (NT) opening an office in Lagos, Nigeria is a small development but it caught my attention because you don’t hear much about Africa when it comes to the telecom equipment market.

For suppliers looking for new opportunities, China and India capture most of the spotlight with perhaps South America getting some attention. As well, it’s difficult to tell how much revenue suppliers are getting from Africa given sales in the region are usually lumped together with the Middle East.

But according to Ovum, there will be another 200 million telecom customers in Africa by 2013, with more than half from Western Africa.

“End user demand on this scale will require considerable infrastructure investment by service providers, many of whom face challenges in balancing network capacity with growing demand” says Angel Dobardziev, practice leader, Emerging Markets, Ovum.

Growth is obviously great but the key question is how profitable sales in Africa will be for telecom suppliers. Many suppliers, including Nortel, have discovered in India, for example, that profit margins can be razor-thin.

More: According to IDC, IT spending growth in Japan, Western Europe and the U.S. will be about 1% in 2009, while Central and Eastern Europe. Latin America, the Middle East and Africa will “experience healthy growth”.

Comments

[KINGKONG:]

GUESS WHAT? MR LI KA SING OF HONG KONG HAS SHOW SOME INTEREST IN NORTEL. FOR A COMPANY THAT IS WORTH MUCH MORE THAN 50 CENTS U.S. HE IS WILLING TO INVEST IN IT AND MAKE BILLIONS OF DOLLARS.

LOOK AT HOW HE INVESTED IN HUSKY OIL BACK IN THE MID-80'S AND HOW HE BOUGHT AND SOLD ORANGE TELEPHONE TO GERMAN TELECOM.

2008 Nov 20 01:12 AM

[NortelEmployee:]

Mark Evans disclosure. Perhaps you could disclose how much you lost in Nortel shares. There must be a reason that every little thing about Nortel is getting your (negative) attention as you suggested above. Do you have an underlying psychological problem or does John Chambers actually fund Seeking Alpha. I just don't understand why someone would write(diarreah of the pen) so many negative things about a company without some motivation to do so.

2008 Nov 21 09:56 AM

[beenhereb4:]

NortelEmployee: You've got to be kidding. NT closed today at
$0.42 US. Interestingly enough that's exactly the same price that I purchased it about 8 yrs ago when it was also in the cellar. The only difference is a 1for10 reverse split since then. If everyone in NT would stop babbling about technology, and instead get on the dollars & cents, gaining market share, beating competitors, establishing a sustainable differential advantage, then you might get somewhere. However, I personally think its too late.

2008 Nov 21 05:13 PM

[KINGKONG:]

INTERESTINGLY ENOUGH, GUESS WHAT? THERE ARE OVER 40 MIILLION SHARE SHORT ON NORTEL. THIS IS A VERY BULLISH SIGN ON THIS STOCK BCS THE STOCK PRICE WILL GO UP 50% A DAY FOR A FEW DAY BEFORE THE SHORT COVER ALL THEIR POSITION.

NORTEL WILL HAVE POSITIVE EARNING IN THE NEXT FEW QUARTER BCS OF LAYOFF AND COST CUTTING. NORTEL SHOULD EARN AROUND 25 CENTS TO 30 CENTS IN 2009 AND 50 CENTS IN 2010. SO IF SOMEONE SAID THIS STOCK WILL GO TO ZERO, HE IS JUST NOT QUALIFY TO DO THE ANALYSIS.

2008 Nov 22 11:48 AM