Lucent steals march on Nortel with new switch
canoe.com
Thursday, May 28, 1998
By PHILIP DEMONT
Telecom Reporter The Financial Post
U.S. telecommunications equipment manufacturer Lucent Technologies Inc. unveiled new products yesterday to send data and voice signals over the Internet or private networks, a move
that could threaten Canadian rival Northern Telecom Ltd.
Nortel is working on communications switches and transmission equipment to chase this lucrative
market. But Lucent, the former equipment arm of AT&T Corp., appears to be first off the mark,
industry watchers said.
"Now, Lucent has all, or damn near all, the pieces," said John Celentano of Skyline Marketing
Group Inc., a consultancy based in Owings Mills, Md.
Its new products include a computer switch and an access server that combine phone calls with
Internet data traffic on a single network, allowing phone companies and Internet service providers
to offer more local and long-distance services.
U.S. long-distance companies such as MCI Communications Corp. and AT&T Corp., along with
the Baby Bells and newer telecommunications providers like Qwest Communications International
Inc. want the equipment to enable them to offer more profitable voice and data services to
businesses.
Lucent is eyeing a larger share of the data transmission market, estimated to be worth more than US$20 billion in North America by 2001.
For its part, Nortel couldn't understand why industry analysts were so excited by Lucent's announcement yesterday. "I don't see where Lucent is ahead of us," said Glenn Falcao, general manager of public data networks. His company has already introduced a faster switch than what Lucent unveiled, he said. Lucent shares (LU/NYSE) closed at US$72, up US1 7/8. Nortel (NTL/TSE) ended the day at $93, down $1.
-- with files from Bloomberg
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