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A Day (and a half) in Dallas, or, Connecting with Nortel Global Connect

Joel Hackney, President of Nortel Enterprise, stated that Nortel's enterprise vision is to become "the preferred partner in unifying all communications through leading product solutions, software and services." Hackney stated that there will be a major shift in Nortel's business, as it moves from a revenue breakout of 80% hardware, 15% services, and the rest in standalone software. Five years from now, each category will represent one-third of its revenues. This is based on what the company is seeing in UC today and where customers are willing to pay for the value. He noted that there is an acceleration in software and services, with SOA and web services making it much easier to integrate applications, and for Nortel to play in the application space. In addition, the number of applications that will be web services enabled will explode, turning the focus to integration and real time communications- which just happen to be the areas where Nortel excels. Nortel is "squarely focused on UC," and is investing heavily in UC and SOA, and that by moving to SOA, UC can more easily be integrated into business applications.

Some of what we heard at the conference was not unique to Nortel - we hear similar things from other vendors, such as how the company is leveraging its competitive differentiators (which include advanced voice features and real time communications), how it is taking an open standards approach across market leading applications, focusing on integrating real time communications into business processes for real results, and leveraging deep partnerships with the likes of Microsoft and IBM. Hackney also stated that Nortel is aligning its resources to create fuel for growth by shifting its resources(up to 43%) to accelerate the transition to software and UC. This is great, but Nortel's competitors are all saying similar things.

What we did hear that is slightly different from some competitors is that the company is winning in many of the deals that it gets invited to, and over 50 customers recently switched to Nortel based on its Microsoft UC alliance. The company is winning more deals and has more deals in the pipeline based on its work with IBM and Microsoft. Stephen Murdoch, VP & GM Global Infrastructure Consulting Services of Dell, told us that Dell selected Nortel as its strategic UC partner, in part based on the Nortel/Microsoft ICA (Integrated Communications Alliance) relationship. And Ruchi Prasad of Nortel stated that Nortel and Microsoft now have 800 joint UC customers, which is an increase of 200 since I spoke to Ruchi at VoiceCon in March. Not too shabby.

Ruchi also provided an update on the progress of ICA, including delivery of the branch office product in March, and work being done in the contact center area (side note: Microsoft still has not announced its contact center strategy or declared a go-to-market partner - will it be Nortel, Aspect, Mitel, or a homegrown solution? Nortel is certainly jockeying for position.) Noting that an end-to-end services capability is needed for deployments in heterogeneous environments, Ruchi stated that Nortel is working on this skill set and is investing in technology, operations and business consulting with customers, and customizing solutions based on .NET. What I most appreciated about Ruchi's presentation is that she acknowledged that Nortel will have to play a different role in coming years, and she said that Nortel is not shying away from the question about what will be the vendor's role in several years as OCS becomes the platform? Most (not all, but many) telephony or switch vendors that I talk to about this either avoid answering the question, or are in denial about the possibility. Nortel came right out and answered the question before we had a chance to ask it - Nortel is clearly going to be more of a software and services company. Again, Nortel isn't the only company on this path, but it's encouraging to hear them be forthright about it.

We also heard from Lori McLean about Nortel's relationship with IBM. For more on the progress they're making, listen to my podcast with Lori at Nortel doesn't have as many UC implementations with IBM as it does with Microsoft, but this relationship is also more recent and needs to build on the momentum that's been started.

Throughout the conference we heard how data is a critical part of the whole UC experience and is a necessary part of the solution, which has been helping Nortel win more deals recently. Hmm, could Nortel be taking jabs at any of its competitors who don't have a data networking division? I wonder...