AlcaLu Execs Lose Out as Nokia Unveils New Top Team

Nokia has revealed details of the planned top management team that will run the company once it has completed its €15.6 billion (US$17.6 billion) takeover of Alcatel-Lucent, with the list of senior appointments skewed heavily towards executives at the Finnish vendor. (See Nokia Makes €15.6B Bid for Alcatel-Lucent.)

Of the 13 executives that have now been named to leadership positions (including the CEO), just three are currently at Alcatel-Lucent and the status of several highly regarded AlcaLu individuals remains unclear.

Indeed, Nokia Corp. (NYSE: NOK) appears to have preferred Alcatel-Lucent (NYSE: ALU) executives only in those cases where it had no clear existing alternative.

The Finnish vendor's chief objective in acquiring Alcatel-Lucent was to beef up its fixed networks and New IP capabilities, and the three Alcatel-Lucent executives that will hold on to senior roles are all experts in these areas. (See AlcaLu Deal Makes Us 'More Complete' Than Ericsson, Says Nokia CTO, Nokia & Alcatel-Lucent: What's Going On? and Nokia + AlcaLu: What the Analysts Say.)

The three 'chosen ones' are:

  • Federico Guillén, the president of Alcatel-Lucent's fixed networks business, will retain that job title once the merger has gone through, with fixed networks comprising one of four business groups that will form Nokia Networks.

  • Bhaskar Gorti, Alcatel-Lucent's current president of IP platforms, will become president of the new applications and analytics division.

  • Basil Alwan, who currently serves as Alcatel-Lucent's president of IP routing and transport, will take charge of the IP and optical networks group. Alwan has been a high flyer at Alcatel-Lucent, presiding over the one part of the French company (apart from the small licensing division) that has continued to report healthy growth in sales on a constant-currency basis. In the second quarter, revenues from Alcatel-Lucent's core networking business grew at a year-on-year rate of 22%, to €1.68 billion ($1.89 billion), and by 10% on a constant-currency basis, while Group revenues were up 5%, to €3.45 billion ($3.88 billion), but down 9% in constant-currency terms. (See AlcaLu Grows Profits Ahead of Nokia Deal.)

    The biggest of Nokia's four new business groups, mobile networks, will be led by Samih Elhage, currently Nokia's executive vice president and chief financial and operating officer. That group will include Nokia's huge Global Services business (comprising professional and managed services), which currently accounts for about half of Nokia's revenues, as well as Alcatel-Lucent's managed services activities, making it by far the largest of the four units in revenue terms.

    (For more details on the focus of each business group, see the full Nokia announcement: Nokia Unveils Combined Nokia/AlcaLu Management Team.)

    This obviously raises questions about the future of Dave Geary, Alcatel-Lucent's existing wireless president, as well as Nokia's own Igor Leprince, who currently manages the Global Services operation.

    All four business group leaders will report directly to Nokia CEO Rajeev Suri, who will remain in the driving seat following the takeover.

    Former Alcatel-Lucent CEO Michel Combes has already joined French cable group Altice as chief operating officer with particular responsibility for international activities. (See Ex-AlcaLu Boss Tasked With Bolstering Altice.)

    But a number of other senior executives at Alcatel-Lucent may now be on the lookout for opportunities elsewhere, having missed out on a role in the new-look Nokia's top management team.

    For more NFV-related coverage and insights, check out our dedicated NFV content channel here on Light Reading.

    Timo Ihamuotila will remain Nokia's chief financial officer and Marc Rouanne -- currently Nokia's executive vice president of mobile broadband -- will become chief innovation and operating officer (CIOO).

    The naming of Rouanne to the CIOO role and the lack of any announcement about a separate chief technology officer (CTO) could also have ramifications for Marcus Weldon -- who is currently both Alcatel-Lucent's CTO and the president of the French vendor's Bell Labs R&D outfit -- and Hossein Moiin, Nokia's existing CTO.

    Nokia declined to comment when asked by Light Reading if Moiin would remain CTO and whether there would be a role at the new company for Weldon, saying that it was not commenting on any roles other than those announced today.

    But that doesn't rule out roles for those not named today: A spokesperson at Alcatel-Lucent noted that today's announcement concerns only the top level of management reporting directly to the CEO. "The layers will be appointed and announced one by one, so we will see who is where as the operating model is fleshed out," said the spokesperson.

    Other possible casualties of the merger include Philippe Keryer, Alcatel-Lucent's chief strategy and innovation officer, and Tim Krause, its chief marketing officer.

    Nokia has indicated that Kathrin Buvac will assume the role of chief strategy officer, having previously been Nokia's vice president of corporate strategy, and that Barry French will remain as Nokia's chief marketing officer.

    Nokia Technologies, which is focused on licensing and "the incubation of new technologies," will operate as a separate business to Nokia Networks and will have its own product development and operations team. Ramzi Haidamus will continue as President of Nokia Technologies, reporting to Suri.

    The other C-level appointments include: Ashish Chowdhary, who will move from the position of chief business officer to that of chief customer operations officer; Hans-Jürgen Bill as chief human resources officer (he is currently Nokia's executive vice president of human resources); and Maria Varsellona, who is to remain as chief legal officer.

    — Iain Morris, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, News Editor, Light Reading

  • bosco_pcs 10/7/2015 | 2:37:09 PM
    Re: No major surprises as it is NOT a merger I have no sympathy for the original merger crew of Alcatel and Lucent. And the 2nd generation was not much better. However, the current iteration deserves so credit from coming back from the brink, especially in the form of a French company. Quite frankly, this smartest thing Nokia did recently is to dump the handset division to the sugar daddy. So, this executive lineup certainly affects my decision to hang on to the remainder shares of my holding
    [email protected] 10/7/2015 | 10:00:23 AM
    Re: No major surprises as it is NOT a merger Cloudband gets a namecheck in the details of the Apps and Analytics division -- which appears to be the 'cloud' division (if not by name). Ex Oracle Comms head Gorti is the lead.


    Applications & Analytics (A&A) would combine the Software and Data Analytics-related operations of both companies. This comprehensive applications portfolio would include Customer Experience Management, OSS as distinct from network management such as service fulfilment and assurance, Policy and Charging, services, Cloud Stacks, management and orchestration, communication and collaboration, Security Solutions, network intelligence and analytics, device management and Internet of Things connectivity management platforms. CloudBand would also be housed in this business group, which would drive innovation to meet the needs of a convergent, Cloud-centric future. The designated President of Applications & Analytics would be Bhaskar Gorti, who currently serves as President of IP Platforms, Alcatel-Lucent.
    Gabriel Brown 10/7/2015 | 9:17:34 AM
    Re: No major surprises as it is NOT a merger Couple of other thoughts:

    * No cloud division? Nuage goes to IP/optics, but what about CloudBand? To Apps & Analytics? Is it a given that CloudBand survives? Or is the team supposed to get behind the Nokia cloud management portfolio? Some form of merger?

    * Not many women in top leadership roles. Paging Sarah Thomas right now.

    * And, obviously, wireless portfolio overlap is a whole other topic.
    Gabriel Brown 10/7/2015 | 8:35:00 AM
    Re: No major surprises as it is NOT a merger I think that's right. This deal needs firm direction and decisiveness. Nokia learnt that from the Siemens merger/acquisition. The talk from Suri is he, and his team, know how to do it right this time around. 

    Philippe Keryer and Marc Rouanne worked closely together back in the Alcatel days (pre-Lucent) and seemed part of an effective team. Whether they liked each other then, and whether they still get on after competing fiercely... who knows!

    The CTO part is interesting. Neither Moiin nor Weldon seem like they'd be happy working under the other. Maybe Weldon gets an R&D leader role and Moiin stays as CTO.

    Marcus Weldon just wrote a book The Future X Network: A Bell Labs Perspective so he's positioned himself into that sort of role.
    [email protected] 10/7/2015 | 7:51:28 AM
    No major surprises as it is NOT a merger When ALcatel and Lucent came together to form one big disfunctional company, it was a merger so there had to be some sort of parity on the top table, a situation that caused no end of headaches.

    This, though, is an acquisition, so Nokia calls the shots basically - - hence, most of the top team are Nokia folks.

    I wold expect to see some more ALU names in the next tier down but also expect to see some of them pop up elsewhere.

    In my view, Nokia would do well to hang on to the experience and energy that Marcus Weldon brings to any team. If he doesn't get a role I'm sure he will soon turn up at one of Nok/ALU's rivals. 
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