Lucent puts pressure on
Nortel Networks rival to announce expansion
plans for Canada
By CP
TORONTO -- The world's largest telephone equipment maker,
Lucent Technologies Inc., will announce expansion plans for
Canada today in a move by the big U.S. company to grab a
larger share of the fast-growing Canadian telecommunications
market.
Company officials declined to release details yesterday but
analysts say Lucent is trying to capture a bigger chunk of
Canada's multibillion-dollar market as its chief rival, Canada's
Nortel Networks, continues to make inroads in the giant U.S.
market.
"It doesn't surprise me at all because Lucent is looking to appear
more global -- that's their life," said one analyst who asked not to
be named.
"Their business is still highly concentrated in the U.S. ... Going
into Canada allows them to attack Nortel on their home turf."
Lucent, based in Murray Hill, N.J., is currently building its new
Canadian headquarters in Markham, north of Toronto. The new
complex includes a recently completed warehouse.
Lucent, which was spun off from AT&T Corp. two years ago,
scored a major victory over Nortel earlier this year in the
Canadian market.
In July, Sprint Canada put some big money behind its promise to
enter the local telephone service market with a decision to buy
$400 million worth of phone-network technology from Lucent.
Lucent's Canadian subsidiary, Lucent Technologies Canada,
already has more than 500 employees.
Still, Canada "has been a market that Nortel has dominated," said
Robert Wilkes, industry analyst at Brown Brothers Harriman and
Co. in New York.
"Nortel has been competing with Lucent in the U.S. market for a
long time ... Nortel is certainly well known among large telephone
companies in the United States."
Lucent and Nortel compete head to head with many product
lines and services, particularly when it comes to telephone
switching gear, networking equipment and wireless products.
That's why the Sprint contract was a major inroad for Lucent as
it broadens its global business.
Toronto-based Sprint Canada provides long-distance voice, data
and Internet services to more than 1.35 million customers.
The gear it bought from Lucent supports wireline, wireless, voice,
data and video applications and voice messaging, allowing the
future delivery of a wide array of communications services. |
