VoiceCon Interview: Joel Hackney of NortelVoiceCon Interview: Joel Hackney of Nortel

I had a chance to sit down with the President of Enterprise Solutions at Nortel, to talk about customers gained and lost, and where Nortel's headed.

One of the biggest question marks at this VoiceCon is the future of Nortel--and, therefore, the future of its customers. Rivals from Avaya to ShoreTel are aggressively trying to poach Nortel customers and channel partners while Nortel remains in Chapter 11, while those same customers and channel partners are looking for answers and a way forward.

I was able to get some time this morning with Joel Hackney, who runs the Enterprise Solutions business for Nortel. He's here in Orlando with the message that, as he put it, "First and foremost, we're absolutely in business." Though he wouldn't--in fairness, couldn't--be very detailed about the company's immediate future, he did describe how Nortel is attempting to meet the challenges of Chapter 11.

Customer Losses and Wins
Hackney conceded to me that, in terms of customer orders, "we did have a significant drop at the time of the filing," which took place on January 14. He said he couldn't get specific about how much business was lost during this time.

However, he also said Nortel has had some customer wins since the filing, and promised there would be announcements this week with names and details of these wins.

Nortel's competitors have not been slow to try and take advantage of the straits that Nortel finds itself in; one executive from another vendor described it as "people circling like vultures." Joel Hackney insisted that "it doesn't surprise us," and he was ready with a zinger of his own, saying that, "When Avaya went private and they've got $5.5 billion of debt," this is also the kind of consideration that customers would need to keep in mind. In contrast, he touted Nortel's ability to shed much of its cost burdens through the Chapter 11 process. "We no longer have a lot of baggage that other vendors are under," he said. It must be said, however, that Nortel's handling of its expenses in bankruptcy have come under fire, from the withholding of severance to the payment of bonuses.

Ultimately, Hackney insisted, "To some degree, customers have become immune to" all the back and forth.

When it comes to Nortel's best-known communications partner, Hackney said Nortel doesn't feel threatened by Microsoft's ever-increasing tendency to talk up its Office Communications Server as a PBX replacement, and its addition of features such as audio conferencing and attendant features to OCS Release 2.

"We think there is a portion of the market that will be PBX-less," i.e., using platforms like OCS for their voice call control, Hackney said. But making up for this, he said, will be their need to rely on companies like Nortel, with a long history of implementing real-time communications at scale, with value-added feature capabilities that support business-critical apps.

What Will Become of Nortel?
Not surprisingly, Hackney wasn't able to answer that question, at least not directly. He couldn't comment on the widely reported rumors that Avaya and Siemens, among others, have explored acquisition of the Nortel Enterprise unit out of bankruptcy. He was only able to say that, "We're working as hard as possible to get the restructuring plan completed and announced as soon as possible."

In light of Nortel's sale of its Layer 4-7 data business to Radware for north of $17 million, I asked Hackney if it made sense for the rest of Nortel's data networking business to be split off from the voice product lines. His response: "I think they're very synergistic, and I think they increase our value to customers significantly."

Buying and Selling in a Down Economy
Of course, Nortel's hoping to do more than simply reassure people that they're still around. They've already made an announcement around their VoiceCon presence, with more promised. Hackney noted that, though Chapter 11 obviously isn't something a company wants to go through, the timing of Nortel's filing meant that they weren't as likely to see a mass exodus of customers, simply because with the broader economic downturn, enterprises aren't making quick moves or new investments as readily. "Customers want to sweat assets longer," Hackney said. "There's a pause button, if you will, on customers' overall investment levels."

As for what he's seeing in customers' investment plans as a whole, Hackney said he expects "more pressure than not" on budgets to continue for several more quarters, with areas like health care, government, and even some areas of finance, offering glimmers of hope.