Nortel restates, releases, recaps

Nortel Networks recorded a US$80 million loss in Q4 2006, an improvement over the US$2.3 billion loss a year earlier. The news came after Nortel's announcement that it would restate the 2004, 2005 and 2006 finances because of accounting errors.Also, financial regulators in Canada and the US filed fraud charges against former Nortel executives, including CEO Frank Dunn, CFOs Douglas Beatty and Michael Gollogly, and assistant controller Mary Anne Pahapill. The SEC accused them of ignoring good accounting practices and attempting to manipulate Nortel's results.At VoiceCon, held in Orlando in early March, the equipment provider unveiled the 2500 and the 4500 Ethernet Routing Switches (ERS), offering power over Ethernet (PoE), quality of service and Gigabit Ethernet connectivity.Nortel also unveiled a new CS1000 IP-PBX, capable of supporting 22,500 end points. Multiple instances of the platform can be linked in cross-branch and inter-core configurations for failover, and it runs as software on standard server hardware.Nortel's software approach exemplifies an overall industry trend away from hardware. Nortel, Avaya Inc. and Cisco Systems Inc. representatives all touted the software way at VoiceCon, insisting that communications equipment is increasingly a matter of application codes and less about boxes and microprocessors.Meanwhile, in a candid explanation of the company's plans Nortel CTO John Roese told the VoiceCon audience that the firm sold its 3G wireless portfolio because Nortel had little confidence it would go anywhere. Roese also said MPLS is "a solution in search of a problem," and future IT infrastructures will combine communications and applications even more than they do today. Roese said that's why his company joined Microsoft Corp. in a venture to build unified communication (UC) systems last year. "We simply saw a convergence. Instead of resisting that trend, why not embrace it and lead it?" Nortel's work with Microsoft has been questioned: some think the telecom gear maker is getting the short end of the stick. See "Shell digs into unified communications."

Nortel restates, releases, recaps

News | April 1, 2007

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