Nortel Networks launches high-end routing product
forbes.com
Nortel Networks launches high-end routing product
Reuters, 05.10.04, 8:01 AM ET
By Jeffrey Hodgson
TORONTO, May 10 (Reuters) - Nortel Networks Corp. <NT.TO> launched a new high-end routing product on Monday it said would let phone and cable companies deliver a variety of voice, video and data services on a single platform.
The Brampton, Ontario-based firm, North America's largest maker of telecommunications equipment, said its new "multiservice provider edge" product is designed to offer the same reliability as traditional voice-only networks.
Most telecom companies now use different networks that include switches for voice service and routers for Internet traffic.
But Nortel said its new device is designed to take those different types of traffic and put them over one network.
"Customers now can take wireless, their multimedia video, their enterprise (business) data networks, and converge it onto one box and know that it's going to work the same way that trusted voice box works in their networks," said Nortel's president of wireline networks, Sue Spradley.
"I think (buyers will be) wireline, cable operators, wireless, anybody today who is delivering consumer or enterprise-based data services."
Spradley said the product will be used in trials by Equant <EQUT.PA> (nyse: ENT - news - people) and Infonet Services Corp. (nyse: IN - news - people), which provide high-speed communications network services to business customers.
She said it will likely be available to the wider market by the fourth quarter.
One industry analyst said the new product will put Nortel more directly in competition with Cisco Systems Inc. (nasdaq: CSCO - news - people) and Juniper Networks Inc. (nasdaq: JNPR - news - people), which make routers used to manage Internet and data traffic.
"It's a very important product announcement for Nortel because their customers are migrating to a common IP/MPLS (Internet protocol multiprotocol label switching) network infrastructure," said Mark Bieberich, a senior analyst at Yankee Group, a research and consulting firm.
"It affords service providers more scalability and more flexibility than what was previously available."
He said telecom companies will likely appreciate the fact the new product can be incorporated into existing networks, rather than forcing them to spend the money needed for a total overhaul.
The product launch comes as Nortel wrestles with the fallout from the firing last month of its top three executives and its admission that accounting problems already under investigation by regulators ran deeper than expected.
The company's shares tumbled 29 percent in one session after it said it expected to restate results for a second time to halve 2003 earnings.
Spradley said that, from what she had seen, the firm's accounting woes had not discouraged customers from working with it.
"We've been through harder times, believe it or not, even than this, although this is very difficult, and the thing that we've shown... we've got employees and engineers than can stay focused," she said.
"Most of our customers are saying let's keep working this thing through and we know you'll be back on top quickly." |
