All About Nortel - Latest Comments in More Outsourcing to Asia

Re: More Outsourcing to Asia

TrueBlue — Fri, 30 May 2008 16:02:38 -0000

I got a good chuckle from this. I would've posted it to the PV Outsourcing article but it's closed to further comment.

From the June 19, 2006 issue of Information Week
http://www.informationweek....

In 2003, Sprint tapped IBM Global Services to handle a number of key software development and IT management tasks, such as developing a Web services environment that would let Sprint rapidly provision new services to businesses and consumers. There were high hopes for the engagement, valued at $400 million over five years. Sprint CIO Michael Stout heralded it as the best way for the telecom company to "focus on areas of growth and innovation." Sprint was counting on the deal as part of a plan to cut $2 billion in operating costs over two years.

Fast forward to 2006. Stout is no longer CIO, Sprint has merged with Nextel, and the company is accusing IBM in court of failing to achieve the promised productivity improvements and of concocting a scheme to "falsely bolster" its performance metrics.

Where did it go wrong? Sprint's internal accounting didn't properly value the work performed by the in-house IT staff, says a former Sprint IT worker who, along with about 1,000 of his colleagues, was "rebadged" to IBM as part of the deal. When those functions were turned over to a contractor, Sprint was hit with sticker shock and balked at the price for a number of projects meant to boost productivity and hit the goals in the contract. "No new projects were going through the pipeline," says the source, who spoke on condition of anonymity and no longer works for either company. Two hundred or more top engineers also left, he estimates, amid the confusion and lack of projects.

Re: More Outsourcing to Asia

many — Tue, 27 May 2008 17:53:19 -0000

ex-nt Yes. I agree. The startup is not as hard, In fact selling it to mid tier telcos and emerging markets is not as hard. What is hard is a tier one carrier in an established market. That is usually where he wheels fall off.

They sadly underestimate the traffic and the number of other boxes they need to accomidate. As well even if they have their act togeather thay usually have very little in the way of KPIs to prove it.

Re: More Outsourcing to Asia

ex-nt — Tue, 27 May 2008 13:08:09 -0000

many, mnss, thanks for the comments. As an old guy, I still maintain that doing a startup in telecom infra used to be extremely hard (70's, 80's, 90's), but has become easier due to easy availability of technology like ATCA hardware, real time telecom Linux, chipsets, etc. I do concede that many startups fail, but some succeed, also some have product problems, but are still commercially successful. However, for startups to succeed in telecom infra is a big change in the market.

Re: More Outsourcing to Asia

many — Mon, 26 May 2008 20:43:10 -0000

ex-nt

I only have experience with Spatial, but they could not cut it in one major network and were ripped and replaced. (Frankly it was a PoS with no prayer in the RAN). I can't speak to the others, but I do know boxes like Sonus are highly suspect in certain applications because they cannot fully co-exist in mixed technology network.

Re: More Outsourcing to Asia

Mr not-so Screwed — Mon, 26 May 2008 20:22:33 -0000

ex-nt, you're telling it like it is. it's true that barriers are somewhat lower in many areas now that networks have a higher ratio of applications to hardware in them than they ever used to.
but startups were always able to outdevelop the big guys, even when they had to develop their own hardware.
it's is not just because startups are better at executing and the big guys are process heavy, although there is some of that.
survivorship bias is at work. we know and talk about startups that are successful, while there is a quiet cemetery full of dead ones.
only the good ones get acquired or get to partner with the big guys on selling their product. so after a while it may seem like startups are so much better at developing products that big guys shouldn't even try, they should just buy those startups. while this strategy can sometimes work, acquisitions are not without risks as well.

anyways, i appreciated your post because you were specific. you named startups and products. i wish everyone who is trying to make an argument did that.
because when i read something like "i believe NT is well positioned to take advantage of growth in new areas" i want to scream BS, BS! name those areas, how positions (what products, services, etc. is it going to provide and when), etc, etc.
so thanks for some concrete examples.

Re: More Outsourcing to Asia

ex-nt — Sat, 24 May 2008 21:57:25 -0000

My proof points are:

- Starent (startup) was able to develop the best carrier grade PDSN and drive Nortel and Lucent from the market. Nortel and ALU now resell their product. They are now attacking GGSN market.
- Spatial (startup) was able to develop a better carrier grade R4 call server, win contracts with T Mobile, and were then bought by Alcatel
- Camiant (startup) has cornered the market on policy servers for carriers and Nortel now sells their box
- Airvana (startup) provides all CDMA EVDO basestation and RNC subsystems to Nortel and Motorola

This all happened in the last 10 years and all these products are right in the middle of the networks of huge global carriers. Back in the mid-90's, no one could break into this market - Nortel, Lucent, ALcatel, Ericsson were invincible as they were the only ones who could develop such products.

Re: More Outsourcing to Asia

many — Fri, 23 May 2008 22:32:04 -0000

Observer, the article makes a good point. However, before Cisco becomes an IT company, it will need some applications. Most of their application/feature software I have experiance with is pretty bad.

I don't count them out, but they are not up to a match with HP/EDS, IBM or MSFT unless they buy Oracle :)

Re: More Outsourcing to Asia

many — Fri, 23 May 2008 22:25:55 -0000

Ex-nt I argue that a awful lot of these products you describe are nothing more than prototypes or at best alpha releases. The ones I am familiar with don't scale and are often developed with a poor understanding of the requirements and of the network.

A GPOS is deployed where RTOS is appropriate.. Threaded models are developed where event driven software is called for. Non deterministic implemetations are sold as deterministic. KPIs are non existant. In short, all the best CoTS hardware in the world will not make up for a crappy application.

Nortel drank the Kool-Aid and started developing crappy software. Hopefully they have learned their lesson, but only time will tell.

Re: More Outsourcing to Asia

Observer — Fri, 23 May 2008 21:17:44 -0000

ex-nt - i believe Nortel has evolved better than their traditional telecom competitors and is well positioned for growth in new areas.

Did anyone happen to catch the management and strategy changes coming at Cisco ? Sounds like it will be Nortel/IBM/Microsoft versus Cisco versus HP.

http://www.networkworld.com...

The change in culture and direction at Cisco also facilitates a change in the way it views its ecosystem partnerships as well, Kerravala says. Cisco sees itself as the center of that universe with ecosystem partners surrounding and supporting it.

The company must now adopt a support role of its own and follow the lead of its IT ecosystem partners as it charts a new course beyond its traditional networking boundaries.

"Cisco has a history of growing up with an ecosystem around it to support it," Kerravala says. "Traditional IT is ecosystem led. It integrates into what they do. It's a different mindset."

Re: More Outsourcing to Asia

ex-nt — Wed, 21 May 2008 13:59:48 -0000

What has actually happened is that the barriers to entry into telecoms infrastructure have fallen. 15 years ago, to develop a high reliability core network product, you had to develop dedicated hardware from scratch, an operating system, application, maybe specialized technology. Today, you can buy off the shelf telecom platforms with hardware and OS. 15 years ago, to develop a new radio product, you needed the ability to develop your own chips for power amplifiers, radios, filters. Today, its all available from a catalog at the chip, or subsystem (power amp) level. So all the discipline and process of 15 years ago was focussed on capabilities that can now be accessed by any company or startup. The issue is that Nortel, and many other telecom infra companies, have not evolved with the times - layers of bureacracy, process, slow decision making, not-invented-here, caution - this mid-90's culture is out of tune with the telecom environment.

Re: More Outsourcing to Asia

NewBlue — Tue, 20 May 2008 12:34:10 -0000

"I think its on the developers to take steps instead of relying on the permission principle."

Sure...but if the organization doesn't provide the lead time or opportunity, when exactly is this supposed to happen? You call it "permission", but I don't think that's what we are actually talking about here. It's certainly not what I am talking about.

If a project that requires 12 months to complete is only given 6 months, when exactly is the developer supposed to design, implement and test the innovative solution? If the architect or senior design lead(s) say, "Do it this way" or "Just hack the existing SW" and the implementation engineer ignores it and does it a different way, uh...how does that work?

If the architect and senior design lead includes and involves the team in the architectural and design discussions, and the project management team grants the team time to implement and test the resulting solution, doesn't that provide a better environment for software development?

Re: More Outsourcing to Asia

observer — Tue, 20 May 2008 11:03:18 -0000

"instead of permitting their developers the freedom to develop it (freedom as in lead time and providing opportunity)."
-
I think its on the developers to take steps instead of relying on the permission principle. I seriously doubt the permission principle ("please let me do this!") is how competitors like Cisco or Juniper operate. Irrespective of where one works, taking steps to influence others will always be an individual responsibility.

Re: More Outsourcing to Asia

NewBlue — Mon, 19 May 2008 14:20:07 -0000

"The reason there are a lot more competitors now is that knowledge and creativity are no longer the differentiators they once were."

I will argue the exact opposite: the reason there are a lot more competitors is that they see opportunities that the incumbents in the industry either don't see or are too bloated with their bureaucracies to effectively implement in time. It's that vision, innovation, creativity, that's missing - no, strike that: not being nurtured - at Nortel. The new competitors have it. Nortel buys it, instead of permitting their developers the freedom to develop it (freedom as in lead time and providing opportunity).

Re: More Outsourcing to Asia

observer — Mon, 19 May 2008 11:47:58 -0000

I guess my point was that none of the businesses Nortel is in are really rocket science anymore and that making a decision is sometimes their worst enemy. Maybe 10-15 years ago it was rocket science the reason there are a lot more competitors now is that knowledge and creativity are no longer the differentiators they once were.

Re: More Outsourcing to Asia

NewBlue — Mon, 19 May 2008 10:08:08 -0000

"Maybe creativity is also becoming a commodity as we get further and further into globalization by the sheer number of people applying their creative talents regardless of where they work."

I don't think so. I think appropriately applied creativity will always be the prime differentiator and as such will not be marginalized due to globalization. That's not to say that product management teams won't attempt to diminish creative solutions, especially if they take time to implement. However, I think the market will always be looking for "more for less" and the only way to deliver on that will be smart creative solutions implemented in a timely manner. That being said, I also think the market will be able to differentiate marketing hype over a lackluster performer from the real deal. I see Nortel's path as leading more toward hype than not, and mostly because of product management's "performance" identified in your following paragraph (and echoed in the sentiment of your post that started this exchange).

"As for repeatedly debating the merits of any argument, I never saw that done better than anywhere else I have worked than at Nortel (otherwise known as the Nortel nod). In this situation, the creative process actually hampers time to market and this has an even worse effect when competitors are making decisions and acting faster."

I don't think that engineering creativity has anything to do with overly extended product definition and delivery times. The lack of ability to remain on schedule has more to do with overly fantastic, or "creative", schedules contrived by product management that have no basis in reality. Nor is this what I was talking about when I responded to your post that the attitude expressed in your response was "the antithesis of the creative process."

My experience at Nortel has demonstrated to me an alarming lack of solicitation and inclusion of new ideas into the creative process by architects and senior members of the development staff. Attempts to participate are gently rebuffed. The prevailing attitude seems to be, don't call us with your ideas; we'll call you. Or, in other words, just do as you are told. That's why I said your response seemed to suggest some hostility toward the creative process.

Re: More Outsourcing to Asia

observer — Sun, 18 May 2008 12:10:34 -0000

Limeoid, do some real research and you'll realize that naming a government type x or y really doesn't matter in the big picture. There was election fraud in the US in 2000 and 2004. Nortel would have gone into bankruptcy if it were not credit loans from the Canadian government. You sound like one of those people who somehow thinks we live in a free market system when in fact Nortel and others in Canada have had loan guarantees and government pension investments directly from the Federal and provincial governments that kept their stock from going to $0. How much do western corporations spend lobbying their governments ? Do you think they expect nothing in return ?

google Nortel Ipernica and see what you come up with. Nortel was violating a patent for years before they got called on it. Same happen with Cisco and Microsoft.

http://news.moneycentral.ms...

http://www.buyingofthepresi...

There's so much more out there its not even funny. Now we can crawl back in our cushy little lair and pretend it isn't or deal with reality.

Re: More Outsourcing to Asia

Limeoid. — Sat, 17 May 2008 15:36:33 -0000

Next thing we'll hear from observer is how great communism is and
that it is no different than democracy.

Re: More Outsourcing to Asia

Limeoid. — Sat, 17 May 2008 15:28:17 -0000

Wow..talk about alot of hot air with no substance.
You ain't got nuthin on puff the magic dragon boy!!!
So enlighten us..and tell me how Cisco, Microsoft and Intel (of
course remembering NORTEL is the center of discussion here) are
guilty of alpha letters A-N..go on I dare ya!

Re: More Outsourcing to Asia

Observer — Sat, 17 May 2008 13:50:04 -0000

Limeoid...Huawei hasn't done anything that Cisco, Microsoft and Intel and others haven't either. Don't make western style capitalism out to be that much more different than what goes on China because its not. The only thing Huawei is guilty of is not marketing themselves as well as their western counterparts. The truth of the matter there isn't much of a difference in what goes on most governments and businesses around the world.

"Fascism should more properly be called corporatism because it is the merger of state and corporate power."

Re: More Outsourcing to Asia

Limeoid. — Fri, 16 May 2008 22:01:18 -0000

Wahway is perhaps a Top Five company 20 years ino the business for the following reasons:
A/ Copyright infringement.
B/ Patent Infringement.
C/ Protected from lawsuits by the Communist Government.
D/ Massive government subsidies and kickbacks.
E/ Hi Tech Theft.
F/ Massive internal corruption.
G/ Dishonesty.
H/ UnderCut the competitor with Garbage and False promises.
I/ Grab employees who defect from other high tech companies and
bring trade and company secrets with them.
J/ Slave Labour.
K/ Child Labour.
L/ Cheap Imitations.
M/ Slap their label on somebody elses product.
N/ International Spying.

These are the reaons WahWay has succeeded.
It has nothing to do with quality, fairness, completeness, ingenuity, invention,
capability, integrity or accountability.
That's just the way it is.

China..Earthquake, viruses, pollution, overcrowding, Communism.
The perfect home for WahWay. Once the outside world gets a real sniff
of this charlatain the Jig will be up if it isn't already.

Re: More Outsourcing to Asia

Observer — Fri, 16 May 2008 21:28:30 -0000

"it is the antithesis of the creative process."
--
Okay I'll bite on this one and let's debate. I'll argue that people are commodities in age of global wage arbitrage and that many parts of Nortel and their competitors businesses are repeatable processes. Do they require ZERO creativity ? Of course not. But then maybe creativity is also becoming a commodity as we get further and further into globalization by the sheer number of people applying their creative talents regardless of where they work.

As for repeatedly debating the merits of any argument, I never saw that done better than anywhere else I have worked than at Nortel (otherwise known as the Nortel nod). In this situation, the creative process actually hampers time to market and this has an even worse effect when competitors are making decisions and acting faster.

It is telling that a company like Huawei, 20 years into its existence, can become a top 5 company in a 100+ year old industry.

Re: More Outsourcing to Asia

NewBlue — Fri, 16 May 2008 07:49:00 -0000

"If you guys spent as much time doing work as complaining then maybe things would turn around a little faster."

This is the attitude that has killed this company. The very idea that we should all just shut up and do as we are told is so incredibly counterproductive...it is the antithesis of the creative process.

Observer...your alter ego isn't Joel Hackney by chance, is it?

Re: More Outsourcing to Asia

many — Thu, 15 May 2008 23:56:19 -0000

Observer

You are correct, where nortel is concerned the truth is bitter. BTW jobs are a commodity unless you work for yourself. Nortel management realized that a long time ago. When people working there finally realize it, companies like nortel will be in real trouble.

BTW Nortel only tells people it is a software company. It still makes far too much money selling that outsourced, but still propritary hardware. Just like cisco.

Re: More Outsourcing to Asia

Observer — Thu, 15 May 2008 19:42:48 -0000

Boy I see a lot of bitterness here. If you guys spent as much time doing work as complaining then maybe things would turn around a little faster.

Mark every company you named above is a hardware manufacturer and Nortel got out the manufacturing business a long time ago. Come out from underneath that rock in the Northwest Territories and do some real reporting.

Re: More Outsourcing to Asia

many — Thu, 15 May 2008 16:49:12 -0000

Speaking truth to power at Nortel went away in the Dr. Frankenstern days :(

It was a tradition at BNR; you were paid to think and because that was cultural it was painfully obvious when someone was not thinking. The culture rewarded good employees, rather than trying to "catch" the bad ones. Once Nortel (Roth) "took over" the whole culture shifted.

A culture emerged where no one fought battles uphill anymore. If something went wrong, it flowed downhill, rather than up no matter where the problem was. As time went on, a lot of inappropriate competition and attitude emerged. Management became an hierarchical oligarchy, with a command or pace-setting methodology (remember vision 2K, internet time, and right-angle-turns?).

When the bottom fell out in 2001, I observed that the people who were let go first were the ones that were the most entrepreneurial. The company retreated to where it was comfortable, rather than moving forward.

From what I can determine; the GE-nuis culture has done little to improve things.