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To: Clarksterh who wrote (18455)	11/17/1998 9:44:00 PM
From: Ruffian	Respond to of 152472

Wireless World Interview, Nt> Wireless World Is On The Way: Nortel's Roth Investor's Business Daily Products geared for tomorrow's cheaper wireless networks could hit the market late next year, says John Roth, [ Northern Telecom Ltd. ] 's chief executive. Wireless is a hot topic. It's just a matter of time before wireless becomes more accessible to mobile computer users who want to tie into the Internet, Roth says. Roth recently spoke with IBD about emerging opportunities in the networking market, including cellular phone-like personal communications services, or PCS. He also discussed Canada-based Nortel's recent acquisition of [ Bay Networks Inc. ] IBD: Where do you see prime opportunities appearing in the next six months? Roth: Wireless continues to go along at a good clip. So (building a) wireless infrastructure for us will continue to be a good business. IBD: When do you think wireless networks that connect mobile users to the Internet will become common? Roth: Right now you see the ads on TV that say you can get wireless usage for 11 cents (a minute), including long-distance. We're still busy building out these PCS networks for people like Spectrum and AirTouch. We're still only working with the first generation of PCS handsets. The second generation of PCS handsets are not that far away. (Technical advances) will improve the price-performance of them and . . . the PCS operations will be much more competitive once (builders) finish the networks. It's not beyond the realm that we'll see four cents a minute in 18 months to 36 months. You're going to see a lot of people thinking about using their PCS handset all the time. IBD: What other steps are being taken? Roth: The industry also is looking at the efficiency of digital technology and the amount of radio spectrum that the Federal Communications Commission has licensed. There is now enough radio spectrum out there to basically take all the phone calls that are currently on the wire-line network in all but the densest North American cities and handle them on a wireless network. Now that's probably not going to happen, so the (telephone companies) and the (PCS firms) are saying: "We're going to have spectrum left for years. Let's fill it with data." The next big drive is how to get all these laptops and personal digital assistants hooked up over the wireless network with a decent bit-rate performance. We should start to see the first of those start to roll out toward the end of next year. IBD: Which geographic areas are expanding the most? Roth: We've done very well in South America during this last quarter. Asia, which we all have concerns about, did quite well for us. South America and Asia combined had about 35% revenue growth (for Nortel). As deregulation moves through Europe, we're starting to see more orders coming from the European market for some of the kinds of networks that we're building here in North America. IBD: What do you think of the extended alliance between [ Cisco Systems Inc. ] and [ Hewlett-Packard Co. ] that's designed to tackle sales to telecommunications firms? Roth: (HP Chief Executive) Lew Platt and I discussed that before the announcement went out. HP and Nortel also work closely together. (HP- Cisco) is a nonexclusive alliance, as I understand it from Lew, and certainly something I would expect them to do. IBD: How could it affect Nortel? Roth: I don't think it will. I think that HP is selling server technology to a number of companies. Nortel uses a version of that technology as well. IBD: Do you think another Nortel competitor, [ Lucent Technologies Inc. ] , will buy a large data network gear maker as Nortel did? Roth: Lucent may well do that. But then, of course, they would have second choice, wouldn't they? IBD: Now that the Bay merger is complete, what's next? Roth: The technology that Bay brings - the routing technology and Level 3 switching - is very important to Nortel for both our corporate customers and our carrier customers, who want to take that kind of technology and build it into their core networks. We're looking for Bay to come to market with the combined strengths of Nortel's widearea networking, local-area networking, PBXs, call centers and all of that. We want to put all of that in front of our customers. I think that's a unique differential that we can do now that sets us apart from everybody else. A little later we'll start to see the benefits of Nortel working with the Bay technology for our carrier customers. IBD: When could technology from the two companies become integrated? Roth: We're selling them together already. The selling cycle for carriers is a little longer than the cycle for enterprise customers. But we already have the products from Bay's labs -the Versalar 15000 - in beta trials right now. That's rolling out as we speak. IBD: What kind of new products will boost the reliability of data networks? Roth: Bay routing technology is . . . a multiprocessor design. If one processor fails, the router loses capacity but still works as a router. The competition's routing capacity is on a single board. If something happens to that board, then the router's gone. IBD: When could joint products be developed? Roth: That's not so much an issue. It's linking them together. Linking up our network management systems is important to allow that to be smooth. But a lot of it is our common sales and service and common support. It's not a matter of designing products to be blended. All these products have to work to open standards. A lot of customers want to have a onestop shop and don't really want to build a network. Nortel is now in the position to build it for them. (Copyright Investor's Business Daily, Inc. 1998. _____via IntellX_____ Publication Date: November 17, 1998 Powered by NewsReal's IndustryWatch ...back to top