Questions re the Future of Nortel ESQuestions re the Future of Nortel ES

Now that Avaya has won the auction of Nortel Enterprise Solutions for $900 million, some of the important questions and issues about the future fate of the acquired company include:

Now that Avaya has won the auction of Nortel Enterprise Solutions for $900 million, some of the important questions and issues about the future fate of the acquired company include:* Will Avaya honor all existing Nortel ES distribution agreements with the large network of dealers? Will some be honored in their entirety, will some be modified, and will some be terminated?

* What will happen to the Microsoft/Nortel ICA arrangement? Or will it even matter anymore?

* What products in the large Nortel ES portfolio continue to be supported going forward at least five more years and which will experience a quick, maybe painless, death sooner rather than later?

* Will Avaya decide to sell-off Nortel ES's collection of data networking products to recoup some of the auction price or continue competing against Cisco Systems (not to mention other competitors such as HP) despite the odds against them? Avaya's past attempts to compete in the data arena crashed almost immediately after take-off. Unless there is greater integration between the voice and data offerings, like Cisco's tight integration between its UCM, Catalyst and IOS routers, I personally would not keep the Nortel data products.

* Most of the discussion to date has focused on the North American market, while giving little thought to the rest of the world. If Nortel ES becomes a de facto American-controlled operation how will it play in markets amenable to Canadian companies, but not so friendly to those that are American? The North America market is large, but the remaining geo-markets are far larger collectively. Avaya needs to more greatly diversify outside of North America (which contributes about half of its current revenues base).

* There are overseas markets, such as France, where demonstrations against Nortel took place following large employee lay-offs, and the fallout can carry over to the new owner. Any additional layoffs will not be met will a smile. How will the new owner turn around the bad public image Nortel acquired recently?

I am positive that there will be many more No Jitter feature stories and blog posts about the fate of Nortel ES before the auction result is approved and the acquisition is finalized. I intend to discuss the interim results during my upcoming talks at the Society of Telecommunications Consultants (STC) conference next month and also during my market review session at VoiceCon San Francisco. Up first, though, is a webcast later this week for The Voice Report on Thursday afternoon. The next few months promise to be quite interesting owing to what may be the most important instant industry event in the enterprise communications market since the AT&T divestiture a quarter century ago forever changed the competitive equilibrium among the leading players and created new opportunities for everyone..