Network World has a Q&A with George Riedel, Nortel’s chief strategy officer who was hired away from Juniper Networks earlier this year. The interview includes his views on IP-TV, IMS, ethernet and UMTS, which has the subject of rampant speculation it will be sold soon. When Riedel was asked about Nortel’s committment to UMTS, here’s his response.
“We’re committed in getting to a decision on that. The statement of the facts are obvious: we don’t have a leading share position there. We have great products but we don’t have a leading share position. Can we make that great product into a leading share position or not? That’s a discussion we’re having real-time. Because if you can’t then what are you going to do about it? We’re actually much more excited, frankly, about 4G as opposed to UMTS. I think if you look at the practical experience of the economics of 3G, one would have to say we wound the clock back five years and this is what we got, would we be happy with all of the investments? I think by and large, no. We actually see an opportunity to continue to invest in a set of technologies around the OFDM/MIMO enabling technologies, which could get manifested in WiMAX Rev C, or an LTE solution for the UMTS (market). And we think operators, both for the services and frankly for the backhaul benefits of some of those technologies, you’re going to see a lot of value in those technologies. Our challenge is to get the time to market right in order to exploit that.”
How can Nortel get into LTE after ditching UMTS access? Sell channel cards like Airvana?
With no UMTS access footprint, Nortel would be out of 3GPP wireless for good.
UMTS
Another tricky thing is that the ratios of persons going on UMTS side (sold) and on GSM side is known (90% UMTS, 10% GSM)… as well as each names, for managers.
So, 90% going to UMTS… but all these people have also worked on GSM on many subjects that only them knows precisely enough to find quick solutions to problems!
OK, it’s running well and there’s not so much problems now. But those who remain hidden but still appear from times to times on such a proven reliable product are, believe my experience, the most difficult to find… And are almost never found in india (even if CRs seemed assigned to them)!
So nortel is leaving 3GPP but if they plan to find clients for what they call “4G” (as if there were a continous progress in technology between 1-2-3G… and we’re now going down with such a bullshit wifi extension compared to intellectually nice UMTS standard!) in the GSM customer base… Believe me, at the very first real problem, customers will not be very happy and not willing to by nortel products anymore.
Regards.
LTE
Nortel will probably OEM old Nortel UMTS gear from Alcatel and a few years down the track it will try to create a new BTS for LTE, likely based on the WiMax BTS they are building now. But by then, there would be noone left in Nortel who can be credible in 3GPP industry (including customers) and whatever it does will probably end up with sub-scale operation. I think we can see from the UMTS experience on how important the GSM footprint was. It’s very likely that: No UMTS footprint = no LTE market share.
My guess is that it will try a backdoor entry through harmomization of 3GPP and 3GPP2 for the LTE/EVDO Rev C. It might work if CDMA business doesn’t die out quick enough. If CDMA dies quickly (which it is looking like happening), then it’s over for Nortel in wireless unless it can build a killer product in Wimax, and Wimax becomes incredibly successful.
Ross
How inane!! So let me see if I got this straight;
1) Nortel is more excited by 4G (what ever the heck that is) than dealing with the reality of their current challenges
2) Nortel will lead in LTE after exiting the UMTS business
3) Nortel will become a supplier of key enabling technologies (at huge margins and with fewer operational challenges), just like … let me see … Qualcomm. Wouldn’t that be great?!
When can we expect something of substance from Mikey’s not-so-new leadership team? In fact, when can we expect something a little more substantial from Mikey himself? Honestly, we shouldn’t expect Mike and his hand chosen band of merry men (remember their stock option packages) to right the ship over night. It is, however, reasonable to expect some leadership and clear direction after ten months at the helm!
So far, Mike has promised back in January at a conference in BC, that he would release a new R&D strategy in two weeks. We are still waiting, well into August. He announced a major JV with Huawei, only to quietly scuttle it a little over two months later. He has made grand pronouncements about 20% market share objectives based on the Jack Welch model, which most believe is inappropriate in today’s reality. He has brought on new leadership and compensated them handsomely with restricted stock plans. He completed the financial restatements (we think), with the result that revenue has moved into future years – that will help support the appearance of a turn-around. And he has utterly failed to deal with the UMTS issue in a timely fashion, subjecting the business to what amounts to a Chinese water torture of ongoing speculation and churn. This has thoroughly demoralised the development team (claimed to be the worst in the last 6 years – if you can imagine!) and lead to wasted R&D investments. Perhaps even worse, is the effect this process will have on the potential proceeds from any sale. Whatever value Nortel might have got for the biz is being compromised, as the whole ordeal is played out before the press and Nortel employees, and Nortel’s bargaining position is further weakened.
I am inclined to agree with the Prudential Securities report. In fact, I would go beyond their claims that the restructuring has been insufficient. Perhaps even more damming is the consequences of a failure on the part of Nortel’s leadership team to develop any coherent strategy and vision to inspire, or at least placate investors, employees and customers.
Finally, Mark, I would encourage you to continue with your suggestions to Mikey and the folks at Nortel. It may be the closest thing to leadership that anyone at Nortel is seeing
Q&A With George Riedl
Network World has a Q&A with George Riedel, Nortel’s chief strategy officer who was hired away from Juniper Networks earlier this year. The interview includes his views on IP-TV, IMS, ethernet and UMTS, which has the subject of rampant speculation it will be sold soon. When Riedel was asked about Nortel’s committment to UMTS, here’s his response.
“We’re committed in getting to a decision on that. The statement of the facts are obvious: we don’t have a leading share position there. We have great products but we don’t have a leading share position. Can we make that great product into a leading share position or not? That’s a discussion we’re having real-time. Because if you can’t then what are you going to do about it? We’re actually much more excited, frankly, about 4G as opposed to UMTS. I think if you look at the practical experience of the economics of 3G, one would have to say we wound the clock back five years and this is what we got, would we be happy with all of the investments? I think by and large, no. We actually see an opportunity to continue to invest in a set of technologies around the OFDM/MIMO enabling technologies, which could get manifested in WiMAX Rev C, or an LTE solution for the UMTS (market). And we think operators, both for the services and frankly for the backhaul benefits of some of those technologies, you’re going to see a lot of value in those technologies. Our challenge is to get the time to market right in order to exploit that.”