& cplSiteName &

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   >   >>
From The Founder
The independent evaluation of Nokia's key virtual network functions (VNFs) was a defining moment for the Finnish giant.
Flash Poll
Live Streaming Video
Charting the CSP’s Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it’s going from two industry veterans.
LRTV Custom TV
Cisco's Innovations in Cable

5|26|16   |   03:18   |   (0) comments


Marc Aldrich from Cisco discusses the latest in security, the evolution and momentum for CCAP and what the industry will be seeing next from Cisco.
LRTV Documentaries
Leading Lights 2016 Highlights

5|25|16   |   02:26   |   (1) comment


Some of the high points from this year's Leading Lights awards dinner at the Hotel Ella in Austin, Texas.
LRTV Documentaries
Light Reading Hall of Fame 2016

5|23|16   |   05:43   |   (0) comments


Find out who has been welcomed into Light Reading's Hall of Fame this year.
LRTV Custom TV
ZTE TM Forum Highlights

5|23|16   |     |   (0) comments


ZTE showcased its new ICT solutions at TM Forum in Nice.
LRTV Interviews
Gamma's MD on the Emergence of UC2

5|20|16   |     |   (0) comments


Gamma Communications Managing Director David Macfarlane believes the unified communications (UC) market has reached a tipping point.
LRTV Custom TV
The Ultimate 5-Minute Guide to Digital Customer Engagement

5|20|16   |     |   (0) comments


In this short video, you will hear all about how Digital Customer Engagement is the key to meeting customer expectations, keeping them happy, and maximizing revenue. VP Product & Marketing at Pontis, Ofer Razon, breaks down for us the five essential capabilities for successful Digital Customer Engagement. Don’t miss!
LRTV Custom TV
NFV in 2016: Part 1 – NFV Use Cases Get Real

5|19|16   |   05:57   |   (0) comments


Consensus is building around the key use cases for NFV, including managed IP services at the network edge and on customer premises, which can generate new revenues from enterprises/SMBs and consumers; Evolved Packet Core to support LTE migration; and adjacent technologies, such as TAS and IMS, to support VoLTE and next-generation charging and policy control ...
LRTV Custom TV
Nokia's Steve Vogelsang on NFV – Part 3

5|19|16   |     |   (0) comments


Steve Vogelsang discusses the challenges of operational transformation and how Nokia helps its customers. Join Steve at the Big Communications Event in Austin the morning of May 24, on his keynote and optical networking panel.
LRTV Interviews
Level 3: Why UC Is In Demand

5|17|16   |   04:12   |   (1) comment


Andrew Edison, Level 3's senior VP of sales, EMEA region, talks about the drivers of growth in the unified communications services market.
LRTV Custom TV
ARM's OPNFV Action

5|17|16   |     |   (0) comments


At the ARM booth at MWC 2016, Joe Kidder and Bob Monkman speak to Light Reading about OPNFV and their upcoming action.
LRTV Custom TV
Nokia's Steve Vogelsang on NFV – Part 2

5|16|16   |     |   (0) comments


Steve Vogelsang gives advice to service providers on how to move to NFV. Join Steve at the Big Communications Event in Austin the morning of May 24, on his keynote and optical networking panel.
LRTV Interviews
Interoute CTO on NFV's Maturity

5|13|16   |   06:46   |   (1) comment


Matt Finnie, CTO at international operator Interoute, explains how NFV has made life easier in terms of logistics and how Interoute can now enable a 'software-defined moment' for its customers.
Upcoming Live Events
September 13-14, 2016, The Curtis Hotel, Denver, CO
December 6-8, 2016,
June 16-18, 2017, Austin Convention Center, Austin, TX
All Upcoming Live Events
Infographics
A new survey conducted by Heavy Reading and TM Forum shows that CSPs around the world see the move to digital operations as a necessary part of their overall virtualization strategies.
Hot Topics
DT: Telcos Must Escape Vendor Prison
Iain Morris, News Editor, 5/24/2016
AT&T to Start 5G 'Friendly' Trial by 2016 End
Dan Jones, Mobile Editor, 5/24/2016
Cisco's Patel Hails 'Microculture' Successes
Iain Morris, News Editor, 5/26/2016
Cable Is Eyeing Its Retail Options
Mari Silbey, Senior Editor, Cable/Video, 5/25/2016
AT&T's Margaret Chiosi Retires
Ray Le Maistre, Editor-in-chief, 5/25/2016
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
In this latest installment of the CEO Chat series, Craig Labovitz, co-founder and CEO of Deepfield, sits down with Light Reading's Steve Saunders in Light Reading's New York City office to discuss how Deepfield fits in with the big data trend and more.
Grant van Rooyen, president and CEO of Cologix, sits down with Steve Saunders, founder and CEO of Light Reading, in the vendor's New Jersey facility to offer an inside look at the company's success story and discuss the importance of security in the telecom industry.
Animals with Phones
Live Digital Audio

Our world has evolved through innovation from the Industrial Revolution of the 1740s to the information age, and it is now entering the Fourth Industrial Revolution, driven by technology. Technology is driving a paradigm shift in the way digital solutions deliver a connected world, changing the way we live, communicate and provide solutions. It can have a powerful impact on how we tackle some of the world’s most pressing problems. In this radio show, Caroline Dowling, President of Communications Infrastructure & Enterprise Computing at Flex, will join Women in Comms Director Sarah Thomas to discuss the impact technology has on society and how it can be a game-changer across the globe; improving lives and creating a smarter world. Dowling, a Cork, Ireland, native and graduate of Harvard Business School's Advanced Management Program, will also discuss her experience managing an international team focused on innovation in an age of high-speed change.