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To: ms.smartest.person who wrote (183)	8/26/2000 9:56:23 PM
From: ms.smartest.person	Read Replies (1) \| Respond to of 405

Myoptic Vision: Netphone technology a pawn for Nortel 8/28/00 By C. A. Soule When Canadian giant Nortel Networks Corp. said it would buy California-based Sonoma Systems for $540 million, it acquired more than a new stable of telecommunications gear built to provide businesses high-speed access to broader networks. It also acquired U.S. Patent No. 5,875,234, a PBX-on-a-card design that uses a single circuit board to deliver client/server telephony, call control, power, and distribution of calls and voice messaging. The architecture provides continuous PBX operation even in the event of an operating system or wide area network failure. Sonoma itself got its clutches on the PBX patent by acquiring it from Marlborough-based Netphone Inc. in March. But somehow, somewhere, buried away in its vaults in Ottawa, one has to believe that Nortel already had one of them thar PBX-on-a-card thingamajigs — or an engineer who could have produced a pretty reasonable, and legal, facsimile. All of that matters little to Nortel now. “We think Sonoma will bring certain vital solutions to the access portion of our network (gear)” said Jeff Ferry, a Nortel spokesman. “We already have a broad array of access products, but if the acquisition goes through, they bring very important technology to the table. But it is too early to guess what happens to the various pieces of Sonoma, because the deal has not yet been finalized.” Sonoma Systems makes broadband integrated access devices based on asynchronous transfer mode technology. Network service providers use the products to deliver a customized bundle of services to subscribers, including Internet, data, voice and video, through a single high-speed access link. The company has its research and marketing installation in Marlborough. Lucent Technologies and Cisco Systems produce similar gear, and a handful of smaller startups are working on the technology as well, including West Coast company Vina, which recently went public. Nortel had previously reached a manufacturing agreement with Sonoma, as had Cabletron Systems, based in Rochester, N.H. Cabletron will now likely have to go fishing for a new OEM agreement on the technology. “The importance of this purchase is that it eliminates Nortel’s competitors from acquiring the Sonoma technology out from under Nortel’s nose,” noted Ron Westfall, a telecommunications analyst with Current Analysis in Virgina. Sonoma had been using Netphone technology in its “Xchange” product when it made the purchase, so if Xchange remains on Nortel’s radar, then so does Netphone. Ferry noted that after Nortel acquired Qtera, within a matter of weeks it announced major new contracts based on Qtera and Nortel technology. “We have a process for the integration of technologies following a purchase,” he said. “We try to hit the ground running. From the moment an acquisition closes, we look to provide end-to-end solutions based on what we gain, because that is what our customers are demanding.” NetPhone Inc. itself still exists as a corporate entity, but has severely scaled back its operations since signing its intellectual property to Sonoma, according to a spokeswoman from that company. Sonoma is just the latest to fade into the Nortel night this year, alongside local companies Epicon and CoreTek, and a half-dozen others. It is not hard to imagine ground zero for each of those companies — an idea hatched in a manufacturer’s or university’s lab, nursed through the early stages of venture funding and technology refinement, then accelerated through the market-opening passages of partnership agreements and OEM deals. The romance of the entrepreneurial startup dashed, the hope of somehow becoming the next Nortel nipped in the bud by the model itself. Possibly somewhere soon in Nortel’s product line, Netphone boards will help connect Nortel products to traditional and next-generation networks, along with all the other elements of all those companies comprising Nortel. masshightech.com