Nortel Not Dead Yet?

Not Dead Yet

David Burton has an interesting blog post about how he believes Nortel (NRTLQ.PK) shouldn’t be written off just yet.

Before anyone gets too excited about Burton’s thesis, he’s focused on the technical side of the house, including projects such as web.alive.

The problem with Nortel has more to do with senior management and strategic vision, and how they align with how company’s develops, markets and sells technology.

You can have the world’s best and most innovative developers but without a clear roadmap that takes into account where technology is going and the competitive landscape, it doesn’t matter much.

I’m not suggesting Nortel’s technology portfolio is bullet-proof, but that even cool technology such as web.alive can’t thrive without the right management team running the show.

Was Bay Acquisition the Beginning of the End?

In 1998, Nortel made an ambitious move by spending $9.1-billion to acquire Bay Networks. Nortel CEO John Roth heralded the acquisition as a key part in Nortel’s enterprise and data strategies.

“We could see a major change coming in our industry,” Roth declared. “This merger of Nortel and Bay is really a creation that is the first of its kind.”

For a variety of reasons, the deal didn’t work - much like many of the multi-billion dollar deals made while Roth was CEO.

In a blog post, Teledynamic Communications president Randy Kremlacek contends the Bay deal was beginning of the end for Nortel.

However, a horribly overpriced acquisition of Bay Networks marked a turning point in the late 90’s. They couldn’t decide if they were a voice company or a data company. Whether they wanted to concentrate on what they did best or be all things to all people.

Comments

[valuenut]

Best realistic article on Nortel I've seen in several months. A factual history of how incompetent Roth and his cronie management teams grandios ideas critically wounded Nortel.

2009 Apr 24 12:34 PM

[Teutonic Knight]

Mark, thanks for your open candor. I worked there in the early seventies and I share your sentiments. In your another article earlier in the month you use the word "Sad". Tragic might be a better word, though.

2009 Apr 25 10:01 PM