Nortel Networks

My Nortel Experiment

By Mark Evans in Blogs, Main Page, Nortel Networks No Comments

In late-December 2005, I decided to conduct an experiment by launching a blog called All Nortel, All the Time that just about Nortel Networks. Why? Well, I had one of those WordPress.com “golden tickets’ that I wanted to use; there were no other blogs dedicated to Nortel (surprise surprise!), and I wanted to see how much traffic I could attract by writing a blog that wasn’t bolstered by my profile as a business reporter with the National Post.

Over the past 14 months, I’ve written 433 posts on Nortel and generated 282,000 pageviews, which works out to about 30 posts a month and 23,000 pageviews. Not terribly successful in terms of traffic but not bad given I’m writing about one company with a stock price that, until recently, has been nothing to write home about. In the past month, however, things are looking up. All Nortel, All the Time was picked up by Seeking Alpha, which focuses on investment opportunities, and traffic hit a record high today at 2,760 pageviews (it didn’t hurt that the CFO quit yesterday, and the company announced 2,900 jobs cuts today).

I’d like to think All Nortel, All the Time’s quasi-success has to do with being focused, enthusiastic and committed – and I would argue these are the elements if you are going to blog the right way; be it about technology, cooking, books or sports. Perhaps the most rewarding part is the traffic and comments I get from Nortel employees, and the fact that after all this time, I’m still the only Nortel blog in town (other than Nortel CTO John Roese). Make of that what you will!

Nortel Sells UMTS Unit

By Mark Evans in M&A, Main Page, Nortel Networks, Telecom Equipment Makers 1 Comment

Nortel has agreed to sell its UMTS unit to – surprise, surprise – Alcatel for $320-million. It was only a matter of time before Nortel sold the money-losing business, and Alcatel seemed to be the most logical buyer. While Nortel can certainly use the $320-million, it is below the expectations of analysts, who were looking for about $500-million. Nortel held a conference call today at 9 a.m. to provide an “update on advances to the execution of its business plan”. According to analysts, Nortel's UMTS access business was losing about $200-million a year on sales of $400-million to $500-million. No wonder Nortel wanted out so badly. With UMTS out of the way, Nortel CEO Mike Zafirovski can now focus on other parts of the business that don't meet his 20% market share benchmark. At the end of the day, Nortel will be a smaller player but, hopefully, profitable.
Update: For more views on Nortel, check out All Nortel, All the Time.

Nortel: When a Profit is Not a Profit

By Mark Evans in Main Page, Nortel Networks, Telecom Equipment Makers No Comments

Nortel posted second-quarter earnings
of $366-million this morning, or 8 cents a share
(compared with analyst estimates of about 2 cents). Before investors get too excited and storm off to jump on the bandwagon again, the bottom line was nowhere as good as it appears. For one, profits were buoyed by a $510-million gain from
shareholder litigation recovery. After accounting for charges related
to restructuring and asset sales, Nortel lost about
$89-million in the quarter, or about 2 cents a share. Another sign Nortel has yet to recover is a sharp decline in gross margins to 39% from
43%. However, Nortel remains confident the rest of the year will be more
promising. CFO Peter Currie said the company exepcts strong sales momentum, high single-digit growth compared with 2005, gross margins of 40%, and operating expenses to be flat to slightly up.

Show Me the Strategy

By Mark Evans in Main Page, Nortel Networks No Comments

My column in today's National Post looks at Nortel's need to spill the beans on where it's headed strategically. CEO Mike Zafirovski has been working away for more than seven months on his corporate makeover, and now analysts and investors want in on his master plan. By the way, Nortel's annual meeting is today.
Update: Here's my story in Friday's National Post on the AGM. It includes some interesting details about some new stock options granted to Mike Z. at a lower strike plan than the ones he received last year when he was hired.

Nortel Slashing 1,100 Jobs

By Mark Evans in Main Page, Nortel Networks 1 Comment

Surprise, surprise (well, not really), Nortel is cutting 1,100 jobs and reviewing its pension plan. The jobs cuts will reduce annual operating expenses by $100-million in 2007 and $175-million in 2008. The company also unveiled changes to its pension plan from defined benefits to defined contributions contributions to  defined benefits, which will save Nortel about $100-million a year. And everyone wondered why Nortel CEO Mike Zafirovski is so bullish about the company's prospects.

What Now, Mike Z.?: Part II

By Mark Evans in Main Page, Nortel Networks 2 Comments

For another long drink about Nortel in the wake of the Siemens-Nokia joint venture, check out my story in today's National Post.

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