Category Archives: ALU

Alcatel-Lucent

What’s Next?

Yes, it is a big deal! Microsoft is acquiring the Nokia handset business for $7.2 Billion. I have lots of reactions to this. Some minor and obscure, and others not so.

First, Microsoft (MSFT) is clearly committed now to a hardware strategy! WOW! Think about its 35+ year history of software and just OMG. Ok, sure it has nearly always sold MSFT branded mice and other minor add-on hardware for PCs. And earlier this year they introduced the SURFACE tablet in an effort to create a greater market interest for Windows8. But now MSFT is solidly entering the mobile device market, not just as a software platform provider but selling and marketing a full range of handsets and smartphones. I hope MSFT knows they have a lot to learn!

Ok, some of you are asking who is Nokia (NOK)?, and why is their handset business worth such a fortune? Well, until Apple (AAPL) entered the mobile phone business not so long ago (it was only 2007), Nokia was the #1 high-end handset vendor globally with 35% market share. They never had the same impact here in the US as they had in Europe and elsewhere. But when I was a director within Lucent’s Mobile Applications business (2001-2004), it was the Nokia handsets that had the features we wanted to use with our experimental and demo applications. Of course, Nokia didn’t make CDMA handsets, only GSM and early 3G/UMTS devices at the time, so it didn’t always work out for us (being Lucent, i.e. direct competitor with Nokia’s network equipment). Instead, we often ended up trying to use HP devices (with clucky PCMCIA cards – remember those?). Does anyone even remember HP making mobile devices? Noooo, me either…

So Nokia had a great device platform for its time. Often running neck and neck with that other innovative handset company – RIM, better known for their Blackberry – the first smart-ish phone; and similar to Apple, with a highly proprietary architecture. What RIM missed (very very sorely, now) was the move to allow mass creation of 3rd party applications (which I advocated for as early as 2002 – someday I’ll pull out my presentation from the 3GSM World Congress in Nice that year, and the following year as well). Nokia and RIM tried this, but too late. Both these handsets businesses are now on serious down swings. It will be interesting if MSFT can do something to save it; and save itself too, given that highly successful and powerful handheld devices have seriously limited the future of the PC… (Aside: I don’t think Google has learned very much, as yet, from its own acquisition of a handset business on a serious down swing…)

Then perhaps, of even more interest to some of you (i.e. ALU employees/retirees/shareholders etc.), is what will Nokia do with its cash windfall? That is, after they pay off the debt to Siemens…?

Re-re-re-re-replanning Alcatel-Lucent

Last week, Michel Combes, the new CEO at ALU announced his plan (of all things “The Shift Plan”) for saving the company and returning it to positive cashflow in the next 2.5 years. Now, where did I hear this before? Oh, that’s right every prior CEO since the Alcatel and Lucent merger/acquisition (and a few of those more than once). What’s different about this plan? From the outside, it’s hard to know… But I can identify some of the things that are similar to all the prior plans:

  • Focus the portfolio and R&D spending on ‘next-gen’ stuff
  • Get out of certain non-profitable markets
  • Reduce SG&A via layoffs
  • Sell (or license) some things
  • Swap certain managers and re-structure
  • Leverage innovation for the future
  • Leave a long runway before results are expected

So what makes Michel et al believe this time will have different results? (Remember this mis-attributed definition of insanity?)  Of course, other than this time, I’m no longer an employee and have a lot less riding on it (though, I’m still a shareholder and a participant in their retiree medical plan). I’m not so self-absorbed to believe that my leaving will make any(!) difference… but, still, I have one piece of advice!

Certainly, the challenges faced by the company are huge. But decision-making and then sticking with those decisions are what’s required, if your title includes “manager” (or any form thereof). In my view, it’s the latter part (specifically ‘sticking with the consequences’) that’s been the critically missing part. All prior plans required actions that were painful, often quite painful, whether to embedded internal interests, to important customers, to certain governmental bodies, or just to the self-image of the company (and its employees). But that’s where the (re-)plan would die: the inability to withstand pain for long enough. It requires much more than a quarter, or even a year. To me, it seemed, just when some positive things were likely and soon, we’d fall back on poor behaviors and try to re-live ‘the good times’ again. Then a quarter or two later, there’d be another missed set of numbers, and yet another re-plan to be announced. My advice to Michel, and especially to all my friends and ex-co-workers (whether ‘manager’ or not): please, have some “stick-to-itiveness” this time!

The pains of change (maybe more than you personally can withstand, yes) will be worth it afterwards! I’ve changed to become more sustainable, so can you! – Jack

WiFi RF Engineering? (not an April’s Fools question)

After the tech bubble burst in 2001, I joined the Lucent Wireless Networks organization as the systems architect and engineering director responsible for 3G data applications. I had a really great group of engineers fighting hard to create the wireless world we actually have today – everything mobile data. And yes, I do mean fighting; because at that time the core power base within the organization was made up of RF engineers, those who had invented the first cellular networks during the 1980s (and earlier), plus their apprentices. They were all *real* engineers, with a deep understanding of the theory, math, technologies and challenges in designing and building cellular wireless network equipment. In meetings they were always devolving into discussions of link budgets, dB, hertz, and erlangs. I was mostly a software and systems engineer; yes, with a strong background in outside plant and voice (aka POTS) networks, but I was a foreigner in their domain, for sure. I suspect a few of them would intentionally take conversations into the deep technical details to a) impress their boss, b) let the one VP, who was an RF engineer himself, take the lead in the conversation, and c) avoid any discussion of the economics or business sensibility of an idea. Well, I learned fast that to thrive in that organization I needed to speak, or at least understand, RF engineer-ese.

In this time frame, Wi-Fi was just getting serious standardization and the PCIMCIA card was its most common form factor; the same form factor as the first 3G data devices. Perhaps that was the cause of the anti-Wi-Fi bias that developed in those RF engineers. Or maybe it was due to only being for short range data transport, and *not at all* related to the cellular business of voice service. But more likely, I suspect, it is Wi-Fi’s use of unlicensed spectrum (after all, you can’t calculate performance when there are multiple indeterminate variables in the RF link budget). So what did naïve Jack do? I became an advocate for fixed mobile convergence and “dual-mode voice service” over Wi-Fi and cellular data, using IMS as the enabling technology… And not long thereafter I moved on to Lucent’s professional services organization.

I smile a lot now, ten years later, with all mobile data devices having built-in Wi-Fi, the industry producing integrated Wi-Fi picocells and implementing of mobile data offload onto Wi-Fi. AT&T and Verizon each have many 10,000s of public Wi-Fi access points in operation for their subscribers’ use. The FCC is adding more free unlicensed spectrum for Wi-Fi to use. And I spent last year working with several of the major US cable operators on their massive outdoor Wi-Fi network RF designs and deployments. Of course, IMS technology is still struggling in wireless networks and the few dual mode services that have commercially launched don’t use IMS. But at least three of the best engineers that worked for me went on to found their own, or to work at, small cell and/or Wi-Fi startup companies (Meru, Ubiquisys, Airvana). They and many others have made it happen, not me. No regrets here.

Who Knew?

One of the greatest frustrations in my career has been the struggle for acceptance and commercial deployments of IMS (IP Multi-media Subsystem) in telecom networks. I started work on the ALU version of IMS with our software release 0.1, 0.2 and 0.3 – which were never intended to see the light of day beyond a lab. But we wanted to get the full requirements process engaged and the development team initialized in the right frame of mind. This was late 2002, when I was director of systems architecture and engineering in Lucent’s Mobile Applications Services Delivery. The initial IMS standards (Rel 5) from 3GPP had barely had time to dry, and had already started significant enhancement/revisions (still occurring). Yet many of us shared the strong conviction that moving voice services from the very optimized, but inflexible implementation that was then common in 2G technologies (and beginning initial deployments in 3G) would be the pathway to an explosion of new services and applications offered by mobile network operators, taking advantage of these new high speed mobile data networks that 3G enabled. We all remember what  happened to the wireline ISPs (Internet service providers),.. They had been reduced to only providing a “simple” point to multipoint IP data transport service for a fixed monthly fee, but with constant demand for higher speed (bandwidth) and capacity (data volume). Where was the money for future network investment going to come from, if not from an explosion of new services/applications? How would mobile operators make money once the inevitable influx of these non-operator (aka over-the-top) applications started coming available over mobile networks? Well, at the time, IMS was our answer!

Ten years later, and no 3G network that I know of has implemented IMS as a replacement for its voice core network. Yes, there have been a few supplemental voice services (e.g. push to talk), and several video or other data services implemented using IMS. I worked on a couple of those… None that I know of were commercially successful; though I’m glad the RCS effort continues to show some progress! Using 4G/LTE technology, MetroPCS is still the only US mobile operator with a commercial Voice over LTE implementation using IMS (not ALU’s). And that implementation may not survive the pending acquisition by T-Mobile (sounds vaguely familiar to another wireless IMS implementation that I worked on…). Verizon’s VoLTE implementation has yet to launch, nor any offering from AT&T.

So where is today’s largest IMS commercial implementation? It’s in wireline voice networks, e.g. over 2 million subscribers on just one US implementation. It is most ironic that the first two releases of the IMS standards didn’t include significant support for these wireline networks!! And we’re still waiting for that explosion of mobile operator applications… Oh, wait, I just received notification of some new appls for my iPhone… …uh!

New Leader at Alcatel-Lucent

Last week, Alcatel-Lucent announced a new CEO, Michel Combes, to be effective on April 2nd. Indeed, as the press coverage has highlighted, Mr. Combes will have plenty of challenges in this job. But ALU is in need of someone like Michel, that’s for certain. It turns out I once had a call with Michel, when he was the recently named leader of Vodafone across Europe, and we in ALU were trying to figure how best to position our Services offers. At the time Vodafone was struggling with its operational model of having each country build and run independent networks and local operations staff, with a fairly thin set of marketing, network roaming assets, and supplier relationships as the only things in common across these different entities. I was the chief architect for the ALU Professional Services division and this meeting was arranged by our sales team with just the three of us on the call. The goal was to figure out a path forward to help Michel to transform Vodafone to be a more centralized operation, and able to leverage much more from common investments in the future. I don’t remember that much about Michel, or much of what we talked about. I just remember being frustrated afterwards that we had little hope of making progress with Vodafone at that time.

Michel’s new challenges are not that much different from back then. Elsewhere there is plenty of coverage and comment about ALU’s cash flow challenges. And the financial markets didn’t particularly like his announcement (ALU dropped 5% relative to the NASDAQ on Friday). Yet, I think it’s good they are hiring someone with a French background and political savvy. As when he was CFO at France Telecom, Michel will need that when it comes to figuring out how to work through the governmental/regulatory and social challenges of ALU’s French and European workforce. I also think Michel needs to re-assess the value and direction of the Services business within the company’s portfolio. Nokia-Siemens reported that about half their 2012 revenues are from Services. Ericsson grew their global Services business by 16% in 2012 to be nearly 45% of their total revenues. Even within ALU, Services has been the second most reliable business for revenue growth (with the IP division leading) and the best business group percentage operating income in 2012 (though still not the >30% it needs to be). Yet in the re-organization effective this past January, ALU’s independent Services unit was disbanded and mostly melded into each of the product units. Yesterday at MWC, the CEO of NSN certainly slapped down his gauntlet in challenge too.

I wish Michel Combes the best of luck with these challenges, and I hope he can find a path to financial recovery and a successful Alcatel-Lucent. In the meantime though, I will explore my own separate path forward as an independent services professional… Wish me luck!

Another story of my naivety

I started work for Bell Labs in May 1984 at Whippany a very naïve 21 year old. My first officemate was an older lady named Martha, who had survived the male dominated culture there for decades before I showed up, had been programming in C since the language existed and had only recently been promoted to the title of Member of Technical Staff (MTS), which I had been given on Day 1. I was (I thought) a hotshot computer programmer, ready to take on the real world (or at least all of telecom)!  Our boss, a gentleman also named Jack, was an orthodox Jew (with which I had no prior experience what so ever), had just recently been promoted to supervisor, but had huge patience and the fabulously rare skill (including, most of all, in me) of listening before speaking. His boss and the head of Artificial Intelligence Systems Department was a noble woman named Fran, who also had long fought and succeeded in the Bell Labs culture. Yet, unlike some other executives that I would work with, Fran ran her department with a soft and steady hand.

I remember a conversation with Jack in his office sometime after I had been there for more than a few months, where we were talking about the naming of things. Not material things, but like the names of work projects, and software modules, etc. I don’t remember the specifics of this conversation, but I do remember making the most ridiculous complaint that we should only be using the word “program” when meaning to refer to software code. And that using “program” to mean a work project or series of projects was too confusing. I was so naïve! Yet, Jack took my ‘suggestion’ without judgment or saying anything of what he must have been thinking…

Later when I had other bosses, I figured out quickly how much of a good thing I had in those first few years. Martha took me under her wing and taught me how to survive and thrive in the corporate culture and coached me through the soft-side of things. Fran and Jack created a safe place to take risks and gave me opportunity after opportunity to perform. After some mildly successful projects, positive customer feedback, my participation in a one year rotational program onto one of our sales teams, and several years of significant experience, Fran was the one to promote me to supervisor (tech manager) before I turned 30 (the ‘test of success’ at the time). I grew, was less naïve and definitely learned a lot during the time I associated with the AI Systems Department and all the very smart people there. But from Martha, Jack and Fran, what I learned most, was how to work with people, of all types, as well as upwards and across management. You made me a better person! Thank you! And I am certain that those that later worked for and with me have also benefited greatly! Doubly thank you!

To all my friends and co-workers at Alcatel-Lucent

My last working day at ALU was Thursday, February 7th. And, yes, this is my “good bye” letter… I’ve read my share of these before too, so I’ll try not to ramble!

I am proud and humbled to have been a part of Bell Labs, AT&T, Lucent, Octel, and Alcatel-Lucent for nearly 29 years! I’ve worked in large variety of roles and organizations over that time, and I have grown and learned so much. I enjoyed nearly all of it, and entirely because of all the interesting and intelligent people here. Though I have had the opportunity to know only a few of you well, ALL of you, collectively and individually, have made this place a wonderful and most difficult place to leave! [Yes, I know, LOL, given the huge numbers of people who have already left and are continuing to do so…]. Nevertheless, this is the right time for me to move on; officially my ‘retirement’. But I eventually hope to take yet a new role, in some new organization. At this time I have no concrete idea where (or when) that will be, but I’m excited about taking such a risk and the new possibilities that will come. Thank you all!

One brief story, that I can’t resist telling of my earliest times in the company:
I had my job interview with Bell Laboratories in New Jersey on January 2nd and 3rd, 1984 (yes, the first couple of days after the huge Bell System divestiture took effect). I had just turned 21 years old, and was a college senior from the small southern university town of Clemson SC, and NJ was a different kind of a place! I was fortunate that when I was still a toddler, my father had worked part time at Bell Labs in Holmdel NJ, while attending Rutgers for his MSEE, prior to serving fulltime in the US Army for his ROTC scholarship commitment, (and later also a four year stint at Bell Labs in Greensboro NC) and that he had kept up some of those connections. Those connections (and I hope perhaps my good grades and some already applicable work experience) meant that Bell Labs was willing to interview me, whereas otherwise they would not normally been recruiting from Clemson.

My first set of interviews were in Whippany NJ (where later I would start my employment in May’84), but for the second day I was driven via limo down to the Holmdel building (an hour trip). I don’t remember much about the trip nor the driver, except for two things… First, the huge six lanes of road in EACH direction!, called the ‘Garden State Parkway’ [lots and lots of times spend there! – yes, that’s humor!]. This was definitely new and different from mostly rural SC. And second as we entered the Holmdel property, just past the huge transistor-shaped water tower (really more like a War of the Worlds Martian war-machine) and approaching the 6 story black-glass building that is nearly a quarter mile from end to end… the limo driver said of the building, with its five vertical rows of concrete balconies stretching the whole length of the building interior overlooking the long atrium, that it reminded him of a penitentiary. Well, I had never been in a prison, but yes I saw the resemblance to movie versions as soon as I walked in the front door that day. And that image has stuck with me ever since, including when my office was on the fifth floor there for 4+ years in the 1990s. Yet, I have to say working there and elsewhere in this company has never, ever, felt like a prison. Just the opposite! I always felt empowered by (most of) my bosses to work on things that were exciting and dynamic, to take risks, and to be free-minded about the how my work would be performed and the results it would derive. And fortunately we never had to fight a war with a Martian water tower!