Light Reading

Nortel's Roth Rakes It In

Light Reading
News Analysis
Light Reading
3/13/2002
50%
50%

How good a CEO was Nortel Networks Corp.'s (NYSE/Toronto: NT) John Roth? So good that he is being paid more not to be at work than he was getting when he ran the company.

Just a few days before former Nortel CEO Roth announced his retirement back in May 2001, he received a $250,000 annual raise, according to documents Nortel filed with the Securities and Exchange Commission (SEC).

For the first four months of 2001, Roth’s base salary was $1,250,000 per year. This climbed to $1,500,000 a year on May 1, 2001. Roth officially retired as Nortel's president and CEO on November 1, 2001. Since then he has been on a yearlong leave of absence, during which he will continue to draw his entire salary.

In 2000, Roth earned $6.7 million in cash, including $1,104,167 in base salary, a bonus of $5.6 million, and miscellaneous pocket-change of $33,199 (see 2001 Top Ten: Fat Cats).

Roth, now Nortel's vice chairman, became Nortel's president and CEO in October 1997, and while he held that title Nortel shrank in size by about 28 percent and lost about 50 percent of its market capitalization.

When Roth took the top job, Nortel had a stock price of around $105 a share and employed more than 72,800 people. By the time he retired, Nortel was down to around 52,600 employees, and its stock price was less than $6 a share.

In the summer of 1997, Nortel's market capitalization was hovering around $32 billion. Now it is about half that.

Along with many other telecom chief executives in the late 90s, Roth's cheerleading about the Internet's exponential growth contributed to many of the unsustainable investments in the telecom market. Moreover, the vendor financing and overblown acquisitions that took place on his watch helped usher in a long and humiliating restructuring period at Nortel (see Nortel Buys: Reaping the Whirlwind? and Nortel: Can This Company Be Saved?). "He misread so many of the signals the market gave him in 2001," says Ariane Mahler, an analyst at Dresdner Kleinwort Wasserstein.

Frank Dunn, Roth's successor, began 2001 with a base salary of $475,000 a year (see Nortel Swings Axe, Switches CEOs). By November 1, he'd been bumped up to $825,000 a year to reflect his promotion, according to Nortel's SEC filings.

Nortel declined to discuss Roth's compensation. "I'm not going to dissect the numbers. They are what they are. They speak for themselves," says Nortel spokesman David Chamberlin.

— Phil Harvey, Senior Editor, Light Reading
http://www.lightreading.com

(40)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Page 1 / 4   >   >>
OptixCal
50%
50%
OptixCal,
User Rank: Light Beer
12/4/2012 | 10:48:07 PM
re: Nortel's Roth Rakes It In
Why should an announcement like Nortel's Roth getting this huge payout upset us? Aren't we all pretty much resigned to the fact that this sort of thing continually happens? On the surface, doesn't this smack a bit of "Enron-gate"? Big execs getting big payouts and leaving just before the fit hits the shan? come on! As an unfortunate investor in Nortel I can only hope the shedding of this "exec's-utive" weight will eventually help.
kcufde
50%
50%
kcufde,
User Rank: Light Beer
12/4/2012 | 10:48:05 PM
re: Nortel's Roth Rakes It In
roth made money, by acquiring companies which are non standards, and people who worked hard , walked out home, why did they paid him salary when he was at home , to make the stock to 5 dollar, if this continues, stock will come to 5 cents
Lopez
50%
50%
Lopez,
User Rank: Light Beer
12/4/2012 | 10:48:05 PM
re: Nortel's Roth Rakes It In
I guess at 15 or so engineers out of 50K were laid off so Roth could continue to collect his paycheck. What a wanker.
Star
50%
50%
Star,
User Rank: Light Beer
12/4/2012 | 10:48:05 PM
re: Nortel's Roth Rakes It In
Thats BS, This jabrone, Roth will continue to drive into the sunset with one of his millions and I said millions of cars he owns, laughing and lying all the way to the bank !
The old geyser is a prime example of all that's wrong with NT and their old school mentality.
I saw this old buck speak 2 years ago to a standing ovation by NT workers only to have them turn on him a year later and beat him down like a government mule.
Today it's clear he's just a Jackass and my NT stock is on a roll in my bathroom waiting to wipe my mudhole...........
optical_man
50%
50%
optical_man,
User Rank: Light Beer
12/4/2012 | 10:48:04 PM
re: Nortel's Roth Rakes It In
Ever see the Poseiden Adventure?
Remember the part where the small group of refugees sees the unending line of poor souls headed towards the bow, and the Preacher says "but the bow is under water, wake up Man, you're headed towards certain death!" and no one listens?
Someone in the refugee group said "we've got to do something to help them!", the Preacher says "forget it, they're aleady dead".

Does anyone who was there (at Norty) see the connection now that time has passed?
optical_man
50%
50%
optical_man,
User Rank: Light Beer
12/4/2012 | 10:48:04 PM
re: Nortel's Roth Rakes It In
Good for John.
He wanted that old fuddy duddy to make a right angle turn, but many of the employees at Norty were too entrenched in their mindsets to change with him.
He tried. He tried darned hard. If you've heard the speeches you know.
If you tried to make a difference and were frustrated, you cashed out your options, and left for somewhere else.
If you stayed and lost it all, and now want to complain, you missed your timing, you should have stood up at a company conference and said "my department is holding us back and I want to change it!".
You didn't did you...
Why? You wanted to become part of the country club set, and figured if you sat quietly long enough, a factor of number of years served would promote you.
Nortel has it's issues, but who doesn't. They are an incumbent and will press on eventually.
Good for John, now quit complaining.
lucidity
50%
50%
lucidity,
User Rank: Light Beer
12/4/2012 | 10:48:04 PM
re: Nortel's Roth Rakes It In
OptixCal -
I must respectfully disagree with you. The "we've all been screwed/will be screwed again by the fat cats" attitude doesn't serve anyone except said fat cats. The management of any corporation must be held accountable for their poor decisions and the effect those decisions have on their employees and investors. Sitting back and sighing "not again" only encourages those who (ab)use the system for their own financial gain to continue their behavior unabashed.
mrcasual
50%
50%
mrcasual,
User Rank: Light Beer
12/4/2012 | 10:48:03 PM
re: Nortel's Roth Rakes It In
Good for John.
He wanted that old fuddy duddy to make a right angle turn, but many of the
employees at Norty were too entrenched in their mindsets to change with him.
He tried. He tried darned hard. If you've heard the speeches you know.
If you tried to make a difference and were frustrated, you cashed out your options,
and left for somewhere else.


I did exactly what you suggested. Worked for me. I don't have any beefs with JR getting all his cash and options when Nortel was going up. He gets paid for peformance, and until the crash Nortel was performing exceptionally based on the only metric that matters at the CEO level, i.e. stock price.

However, I do have a beef with JR getting a 20% raise after presiding over a year that even the most generous of souls would call a disaster. Let's be serious, if any of us had had a similar year, evaluated against our performance metric, we probably would have been fired, not given a 20% raise.
Star
50%
50%
Star,
User Rank: Light Beer
12/4/2012 | 10:48:03 PM
re: Nortel's Roth Rakes It In
Hey Jackass, don't talk about preechers to me...
I went to mine and asked him to forgive me for buying NT stock. I also asked him to prepare last rights for NT.
As far as boats go, that boat at NT has sailed.
Star
50%
50%
Star,
User Rank: Light Beer
12/4/2012 | 10:48:03 PM
re: Nortel's Roth Rakes It In
My only mistake was listening to my fearless leader, "Uncle Buck" better known as JR and drinking the NT Kool-Aid.....

As for your comments, "pull your lips away from JR's ASS and just shut the hell up !"
Page 1 / 4   >   >>
Flash Poll
From The Founder
Last week I dropped in on "Hotlanta," Georgia to moderate Light Reading's inaugural DroneComm conference – a unique colloquium investigating the potential for drone communications to disrupt the world's telecom ecosystem. As you will see, it was a day of exploration and epiphany...
LRTV Documentaries
Cable Eyeing SDN for Headend, Home Uses

5|26|15   |   05:57   |   (1) comment


CableLabs is looking at virtualizing CMTS and CCAP devices in the headend, as well as in-home devices, says CableLabs' Karthik Sundaresan.
LRTV Documentaries
Verizon's Emmons: SDN Key to Cost-Effective Scaling

5|22|15   |   03:53   |   (0) comments


For Verizon and other network operators to ramp up available bandwidth cost effectively, they need to move to SDN and agree on how to do that.
LRTV Documentaries
Lack of Universal SDN a Challenge

5|21|15   |   04:51   |   (3) comments


Heavy Reading Analyst Sterling Perrin talks about how uncertainty about SDN standards and approaches may be slowing deployment.
LRTV Custom TV
Steve Vogelsang Interview: Carrier SDN

5|20|15   |   05:02   |   (0) comments


Sterling Perrin speaks to Steve Vogelsang, Alcatel-Lucent CTO for IP Routing & Transport business, about the new Carrier SDN-enabling Network Services Platform and the operator challenges it solves.
LRTV Custom TV
Carrier SDN: On-Demand Networks for an On-Demand World

5|20|15   |   20:52   |   (0) comments


Steve Vogelsang, Alcatel-Lucent CTO for IP Routing & Transport business, talks about requirements and benefits of Carrier SDN during the keynote address at the Light Reading Carrier SDN event May 2015.
LRTV Documentaries
The Security Challenge of SDN

5|19|15   |   02:52   |   (0) comments


CenturyLink VP James Feger discusses concerns that virtualization could create new vulnerabilities unless network operators build in safeguards.
LRTV Custom TV
NFV Elasticity – Highly Available VNF Scale-Out Architectures for the Mobile Edge

5|18|15   |   5:50   |   (0) comments


Peter Marek and Paul Stevens from Advantech Networks and Communications Group talk about their NFV Elasticity initiative and the company's latest platforms for deploying virtual network functions at the edge of the network. Packetarium XL and the new Versatile Server Module: 'designed to reach parts of the network that other servers cannot reach.'
LRTV Huawei Video Resource Center
Bay Area Spark Meetup 2015

5|14|15   |   3:54   |   (0) comments


Developed in 2009, Apache Spark is a powerful open source processing engine built around speed, ease of use and sophisticated analytics. This spring, Huawei hosted a meetup for Spark developers and data scientists in Santa Clara, California. Light Reading spoke with organizers and attendees about Huawei's code contributions and long-term commitment to Spark.
LRTV Custom TV
The Transport SDN Buzz

5|12|15   |   06:01   |   (1) comment


Sterling Perrin, senior analyst at Heavy Reading, speaks with Peter Ashwood-Smith of Huawei and Guru Parulkar of ON.Lab about the evolution of transport SDN and the integration of technologies.
LRTV Custom TV
Next-Generation CCAP: Cisco cBR-8 Evolved CCAP

5|5|15   |   04:49   |   (0) comments


John Chapman, Cisco's CTO of Cable Access Business Unit and Cisco Fellow, explained the innovation design of Cisco's cBR-8, the industry's first Evolved CCAP, including DOCSIS 3.1 design from ground-up, distributed CCAP with Remote PHY and path to virtualization. Cisco's cBR-8 Evolved CCAP is the platform that will last through the transitions.
LRTV Custom TV
Meeting the Demands of Bandwidth & Service Group Growth

5|1|15   |   5:35   |   (0) comments


Jorge Salinger, Comcast's Vice President of Access Architecture, explains how DOCSIS 3.1 and multi-service CCAP can meet the demands of the bandwidth and service group growth.
LRTV Custom TV
DOCSIS 3.1: Transforming Cable From Hardware-Defined Network to Software-Defined Network

4|29|15   |   03:48   |   (0) comments


John Chapman, Cisco's CTO of Cable Access Business Unit and Cisco Fellow, explains how DOCSIS 3.1 can transform cable HFC network to a more agile software-defined network.
Upcoming Live Events
June 8, 2015, Chicago, IL
June 9, 2015, Chicago, IL
June 9-10, 2015, Chicago, IL
June 10, 2015, Chicago, IL
September 29-30, 2015, The Westin Grand Müchen, Munich, Germany
October 6, 2015, The Westin Peachtree Plaza, Atlanta, GA
October 6, 2015, Westin Peachtree Plaza, Atlanta, GA
All Upcoming Live Events
Infographics
Procera has gathered facts, stats and customer experience feedback from a survey of 540 users from across the globe.
Hot Topics
10 Alternate Uses for Tablets
Eryn Leavens, Copy Desk Editor, 5/22/2015
Bidding War for TWC Looks Likelier
Alan Breznick, Cable/Video Practice Leader, 5/22/2015
Comcast Targets 6 New Gigabit Markets
Mari Silbey, Senior Editor, Cable/Video, 5/21/2015
Chattanooga Charts Killer Gigabit Apps
Mari Silbey, Senior Editor, Cable/Video, 5/20/2015
Potholes Lurk in Indian Smart City Project
Gagandeep Kaur, Contributing Editor, 5/22/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
With 200 customers in 60 countries, Stockholm-based Net Insight has carved out a solid leadership position in one of the hottest vertical markets going in comms right now: helping service providers and broadcasters deliver video and other multimedia traffic over IP networks. How has Net Insight managed to achieve this success in the face of immense competition from the industry giants?
My ongoing interview tour of the leading minds of the telecom industry recently took me to Richardson, Texas, where I met with Rod Naphan, CTO and SVP, Solutions, ...
I recently popped down to Texas to chat with CEO Eric L. Pratt about his company, Taqua.
Cats with Phones
Too Fluffy to Talk Click Here
Elmer found that his bountiful fur got in the way of meaningful conversation.