Nortel Loses Out on Verizon Deal

Since this will likely be a harbinger of things to come the best thing Nortel could do is sell LTE. Maybe package it off with optical that has been for sale since September. Or maybe they will keep them both and sell everything else off?
Maybe they already have plans for LTE and wireless in general that will be announced the next few weeks?
The bottom line is the Nortel LTE product is better than anybodys.
The killer is the current climate and the veil of uncertainty at Nortel.
That is what prevented them from getting in on this.
It certainly was not the technology, or lack thereof.
Ask the people at the big carriers and they will tell you that.
I am sure the big restructuring plan has already made plans assuming they were not going to get a piece of the verizon LTE pie.
It really makes you wonder when three days before this announcement you have guys like richard lowe extolling how great nortel wireless is?

Bad enough an area accounting for almost all their earnings commenced steep decline(CDMA), now their largest customer uses others (like Sprint used others for WiMax). We also witness a 20% reduction in revenue before downplaying folding to fold and delist.

This seems to be ongoing and a sign of things to come further to suppliers getting antsy. How much worse can it get?

Some of the WiMAXe folks was told they have a month from the announcement of the cancelling of the program..I assume in case they can get a piece of LTE pie and latch on…That's dashed now..Time to clear out the desk.

Lowe and his VPs are totally atrocious…every product they have touched turned into stone…It's not the standards, the market or anything else, it's bad program management..Those guys should be gone years ago but they keep feeding Z their half truths and continue to throw million of development dollars down the drain.

Not much worse.
This will be as bad as it gets until all the trash is taken out.

Adding more “constructive” comments. It is no wonder. My sense is that Vz is getting tired of not just Nortel's promises (lies), but alos the notion that their problems can be solved by less than concrete third party solutions that Nortel barely has R&D and Sustaining support oversight for. Two years ago Nortel won two fair IMS and FMC deals with Vz. No sooner did the gear go into lab for standardization, did Richard Lowe and company cancel the hardware and “hooked” up with a different vendor. It's not the first, nor will be the last time for this behavior. It cost a fortune for large operators to operationalize equipment for a big application.

And anyone who has worked with third party partners or OEM also understand that it's immensely difficult to get things fixed and developed. That Mike Z. believes he can resurect the company by being a solutions and systems integrator with COTS and Third Party Products is yet another indication that he just doesn't get what the major operators need.

I believe it's in Vz's best interest at this point to go with vendors with more accountability in product development, regardless of the down turn in revenue of those companies…. neither Ericsson, Alcatel or NS are as horribly run as Nortel.

Trust, people, believe. Verizon is exactly where Hackney and Co, want 'em to be.

I admit feel in part responsible for this snafu as I once helped repair, on the fly, some telco hardware that crapped out during a critical trial, instead of strictly adhering to Lean Sigma protocol by scanning the defective part in/out, and shipping it back for repair in a approved container for it to undergo rigorous quality control and deeper analysis before said trial could commence in a truly real-world scenario. Rules is rules; the customer always needs to be billed for both bits moved and bits lost, irregardless.

I can speculate but can someone in the know confirm if this means Nortel is not invited for the phase 4 trial? Speaking of catastrophic, I think this is game over for MOT as well. There are two providers of any consequence left – the suppliers have to shrink by the same amount. NT better sell quickly to someone or MOT will be in the market chasing any potential buyers.

Confirming – there was an internal memo informing us that we are off the phase 4 trials.

Would not appear that this was unexpected to anyone who has taken an unbiased look at the situation. Sad for Nortel in several ways. The obvious one is the loss of the revenue and market share for the emerging product.

The other is probably more significant given where Nortel is in the process of Credit Protection. Given that they have lost the future business in the growth space of Wireless with their largest customer (not just Wireless but in total), the rest of the Wireless business is left as a cash cow legacy with a rapidly shrinking lifecyle. There is no UMTS or Wiremax. Almost no GSM. Only CMDA, with its limited addressable market and capped installed base. The attractiveness of this business is now very focused with less value and even fewer potential buyers.

It now appears the LTE business could be on the same path as Wimax – lots of promise, upfront investment, loss of the cornerstone customer, no other major wins, then an exit (thru a new partnership). Net result – Nortel is out of Wireless.

Given the state of the rest of the Carrier business (selling core VoIP, but not much infrastructure and very few apps), it would not appear this is a logical part of a new, viable, (smaller), Nortel. Sad day for a company that once was a dominant player in the CO market (ie DMS).

If no one wants to buy MEN, that leaves Nortel as MEN and Enterprise. Neither appear to be big money makers today, primarily due to the wide ranging portoflio it has to invest R&D in and Sales/Marketing spend. Would appear the prospect of a “much smaller” Nortel is going to require more than just layoffs to fix

Keyword: pragmatism over technical “excellence”.

It seems that the only way nortel can go is to sell Carrier. Nortel will go as an IT company in the future.

Nortel is done. The evolution of wireless from AMPS/TDMA and CDMA were always the bread and butter of this Company. I do not belive this Business unit every posted a loss.
How the idiot Judas Z and Lowe could not evolve this cash cow is beyond pathetic.
And the Judas mails state “Our Customers are with us.” They are not and never will be again.
There are numerous Class Action lawsuits coming. Nortel is toast.

One of the dumbest moves in Business history was Judas Z and the BOD asking for protection. MBA students can use this as a CASE study in stupidity.
So to the “I Believe Crowd” stick it where the sun don’t shine.

thanks for confirming.

I wonder how NSN will be affected from not getting a big piece of the cake

I don't think he was specifically referring to LTE. Verizon buys a ton of optical equipment and has a hug Nortel CDMA install. They have indicated they will continue to support these areas. Your other comment on is just stupid.

I never read the Nortel Buzzboard before, but Bo Gowan's spin on the LTE loss gave me a good laugh

Verizon is the latest in a string of home court losses: Bell and Telus going for NSN and Huawei HSDPA overlays; now Verizon selecting Ericsson and Alcatel-Lucent for LTE. The CDMA business has peaked and Verizon will be redirecting its capital budget from CDMA to LTE. Verizon is now the largest carrier in the US; Telus and Bell are second and third largest in Canada. Verizon Wireless has Vodafone, the world's largest wireless carrier, as a major investor.

Many things can be 'blamed' for this: no reasonable company is going to sign up a supplier in CH.11 for a critical part of its forward-looking business. There are supply chain risks, financial risks, operational and market (investor) perception risks. Nortel has done it self no favors by making a huge commitment to UMTS then bailing out by selling its assets to Alcatel. It committed – at least in PR world – itself fully to WiMAX then again bailing out. Who would honestly believe Nortel will deliver LTE? This is NOT a technical capability issue, it's an issue of managerial, organizational and financial wherewithal.

So the 'Oh, we'll get them next year or the year after that' line is a bit dubious. Any customer is going to be open to listening to your sales pitch, visiting your design center and reviewing your proposal. It only matters if they sign a contract AND write the check. Only the big dogs are going to do LTE in the early years and they'll run in a pack… and two of the biggest dogs, Verizon and Vodofone, have voted with their check book. Can Nortel afford to keep a huge and expensive R&D program running for another 16-24 months in the event of a possible contract while its competition it developing, deploying and refining their LTE offering as they deliver them to paying customers???

probably the biggest element in Verizon decision was thinking of what LTE really means… Long Term Evolution and Nortel actually doesn't look like it will be here for Long Term and certainly wont Evolve…

Right “mid-2010″ is all of 15 months away and Nortel will need 6+ of those alone to restructure the restructuring of their restructuring pending the restatements of pre-post-preliminary forecasts.

Nobody takes this company seriously any more…including Verizon.

ok lets see,

Carrier
- WiMesh gone
- WiMax gone
- UMTS gone
- GSM gone
- CDMA almost gone
- LTE to be gone
- Media gateways gone
- IPTV to be gone

MEN
- Ethernet Routers less than 3% share
- Optical losing share
- 40G/100G strong, momentum lost
- optical 6500 strong, momentum lost
- optical 5000 to be gone
- ATM legacy switch to be gone
- new products in 2 years could be gone

Enterprise
- telepresence but economy is down
- BCM strong
- MCS strong
- Gateways strong
- ethernet weak

wireless and men both need to be turfed asap. too much baggage.

I disagree. Things will get progressively worse if the trash is left inside. Inside trash continues to deteriorate and rot, just at a slower rate than when it has been taken outside. It might only be February, but it's time for some serious Spring Cleaning, and the first order of business must be taking out the trash!

I remember the GIS in November, when we were told about how bad the 3rd quarter was. The Company was in serious trouble. But even then, their “plan” (which had to be implemented right away) would not be completed until April. Serious Trouble? But it's going to take 5 months to enact your plan? What kind of morons are running this place. I'm sure the Carolina Strangler and Joe Flap-in-the-Wind are both “very excited” about the prospects of the new Nortel! Flap-in-the-Wind has never been more excited! About anything!

The only thing that might help save the Company is a complete cleaning of the house. Sweep out all the trash, from the CEO, the BoD and the entire executive “leadership” team. Perhaps all the Sic (not a typo) Sigma teams should research the performance of this so-called “leadership” team, and use the data to identify the root cause. The spin on that data would be pretty interesting. After all, we all know the data might not point to what you thought the problem really was. You must remain open-minded to see where the true problem is.

Dick lynch me not.

Do you know where the CS2K fits into this? From what I know of the product there are bits and pieces from Carrier, MEN and Enterprise.

My God. Learn to speak English.

Unfortunate