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Technology Stocks : Nortel Networks (NT) -- Ignore unavailable to you. Want to Upgrade?

To: Thai Chung who wrote (2292)	3/24/1999 10:44:00 AM
From: Kenneth E. Phillipps	Respond to of 14638

Ameritech will acquire 20% stake in Bell of Canada - Signifcant news because SBC & Williams are Nortel customers and FCC has given conditional approval to SBC-Ameritech merger and SBC will own equity stake in Williams Communications. stocksite.com Ameritech Makes Deal For Bell Canada Stake 10:05 03-24-99 MONTREAL (Reuters) - Ameritech Corp. formed a partnership with BCE Inc., Canada's largest telecom group, committing C$5.1 billion for a 20 percent stake in BCE unit Bell Canada. The deal means BCE has at last found a U.S. partner in its quest to expand overseas and gives Ameritech, which is poised to become the largest local phone company in the United States, a toehold in Canada, the two telephone companies said in a joint statement Wednesday. The boards of both companies have approved the deal, which is due to close in May. It will see Bell Canada acquire BCE's stakes in six of Canada's regional telephone companies, a 21.5 percent stake in Teleglobe Inc. and 65 percent of BCE Mobile Communications Inc. from BCE. ''This partnership assures Bell Canada's place at the forefront of the global communications industry while keeping Bell Canada firmly under Canadian control,'' BCE President and Chief Executive Jean Monty said in a statement. BCE plans to use the cash infusion by Ameritech to invest in high-growth segments of its business such as electronic commerce, satellite services, systems integration and content. It may also repurchase some of its shares in the coming year. Ameritech, meanwhile, came one step closer to becoming the largest local U.S. phone company when the U.S. Department of Justice Tuesday cleared SBC Communications Inc.'s $61 billion acquisition of Ameritech, but the deal still needs the approval of several states and the Federal Communications Commission. ($1-$1.50 Canadian) Back to Financial headlines Copyright © 1998 Reuters Limited. All rights reserved. Republication or redistribution of Reuters content is expressly prohibited without the prior written consent of Reuters. Reuters shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

To: Thai Chung who wrote (2292)	3/24/1999 12:54:00 PM
From: mauser96	Read Replies (1) \| Respond to of 14638

The 5/5/99 issue of Forbes ASAP has an interesting article about Nortel. Disruptive technology is very threatening to managers at large companies, so at Nortel they have found the best way to handle it is to by pass whole layers of management. In a company like Nortel (and I'm sure this applies to Lucent also) it is very difficult to overcome the mindset of middle management , who regard disruptive technology as a threat rather than an opportunity. The technology in this case is EtherLoop, a burst way of sending simultaneous voice and data over phone lines. The problem was solved at Nortel by setting up a separate company, Elastic Networks, which in turn could develop a different culture from Nortel, a culture more in tune with IP. This encourages competition with products of the parent company. The article also noted that some vice presidents have a slush fund that they can use to support fledgling products without going through the normal channels. [Companies should always be trying to develop a way to make their present products obsolete, because if they don't do it , somebody else will. However the natural tendency of most middle managers is to protect the familiar. They didn't get where they are by taking lots of chances, so they are not very good at rocking the boat.] It is encouraging that top management at NT is aware of the difficulty that most companies have in handling technology that will eventually impact their main product lines, and is doing something about it. One comment about Lucent- according to Stern Stewart, it's cost of capital is 12.3%, and return on the capital is only 12.9%. Nortel isn't covered by Stern Stewart, but I sure hope it's figures are better than LU.