Bay deal done, new divisions named

Brampton, Ontario

With its acquisition of Bay Networks now complete, Nortel will attempt to cover the IP convergence map with five divisions.

"We're now in business as the new Nortel," says John Roth, CEO and vice chairman of Nortel. "We now have 15,000 employees with market-hardened technology in the field of routing and IP networking."

The company, however, is still sifting through its various product lines to determine which to carry forward and which to leave behind. Overlap has already been spotted in voice-over-IP offerings.

As for the new divisions, Nortel's Enterprise Data Networks line of business is being merged into the operations of Bay. This unit, called Bay Networks, will be headquartered in Santa Clara, Calif. Dave House, chairman, president and CEO of Bay, will head the organization in addition to his responsibilities as president of Nortel.

For the carrier data segment, Nortel is establishing a new line of business called Carrier Packet Networks. This unit will be based at Bay's former Billerica, Mass., facilities and will provide carriers with Nortel's optical fiber transmission systems, high-end routing and switching platforms, frame relay and ATM switches, and dense wave division multiplexing gear.

Some data-network products and technologies from Bay, Aptis Communications and Avici Systems are also being integrated into this business unit.

For the carrier telephony segment, a realigned Carrier Networks business unit has been formed to deliver Nortel's DMS line of digital switching systems and other carrier telephony gear.

Ian Craig, formerly president of Broadband Networks, is president of this organization. Craig's responsibilities also include manufacturing operations for Carrier Networks and Carrier Packet Networks.

Nortel's wireless carrier and enterprise voice customer segments in Richardson, Texas, have not changed.

Nortel has appointed Bill Conner, previously president of Nortel's Enterprise Data Networks line of business, to the newly created position of executive vice president of marketing. Conner is responsible for Nortel's global marketing, communications and branding initiatives.

As Nortel realigns to integrate Bay, it is also combing through Bay's product portfolio to determine what will make the cut. Already, Bay's Voice Gateway 4000 voice-over-IP device, which was a joint development project with NetSpeak, has come to a screeching halt.

Late last month Natural Microsystems was informed it would no longer be needed to supply Bay or NetSpeak with its Fusion voice-over-IP chipset.

Bay's plan to use NetSpeak's voice-over-IP cards in its routers has also been changed, says Al Delorenzi, vice president of Bay Networks business development. Instead of using another vendor's products, Bay will integrate Nortel's Micom voice-over-IP technology into its routers.

"Bay made an equity investment in NetSpeak and that's not going to change," Delorenzi says of Bay's $37 million stake in the company. But Nortel is still working on how or if NetSpeak fits into its game plan, he says.