Headcount: Retro Raises

Chambers gets a raise, Jedai in trouble, SpectraSwitch goes on the block, and more

September 30, 2004

5 Min Read
Headcount: Retro Raises

Surely this is one for the folk at Guinness World Records.

Cisco Systems Inc. (Nasdaq: CSCO) chief John Chambers is getting a $349,999 pay raise, according to documents the company filed with the Securities and Exchange Commission (SEC) on Tuesday.

Since 2001, Chambers has taken a salary of $1 a year, but his yearly options grants are worth tens of millions (see Cisco Renews Options Parade).

But in pure salary terms, that's a 35 million percent pay rise. Even Larry, the Light Reading Attack Monkey, isn't in line for that sort of wage hike (see Hello, Larry!).

"In recognition of Cisco’s increased revenues and earnings and the increase in shareholder value since the end of fiscal 2002, the Committee determined in July 2004 that it was appropriate to increase Mr. Chambers’ annual base salary as of the beginning of fiscal 2005," the filing states.

"The Committee determined that Mr. Chambers’ annual base salary would be reinstated to the fiscal year 2001 level of $350,000."

Rumor has it that Chambers has also agreed to remove the tip jar from the executive boardroom.

Here are some other recent appointments, disappointments, and related developments in the telecom employment universe:

  • The Cisco Sisters return: Also in Cisco's latest filing, the company revealed that it is again considering a shareholder proposal from The Sisters of the Holy Names of Jesus and Mary from Spokane, Wash., a group that owns 10,000 shares in Cisco.

    Last year, the Sisters' proposal concerning a possible review of Cisco's executive compensation policy was voted down. But the Sisters will return again, asking for nearly the same thing (see No Nun Bashing at Cisco).

    The Sisters want the company to produce a report by January 1, 2005, that evaluates whether Cisco's executive pay should be modified. They also want an explanation as to whether layoffs or the level of pay of the lowest paid workers should cause any adjustment to executive pay.

    Cisco's board, naturally, is recommending a vote against the proposal.

  • A vote for Naden: Teknovus Inc., a startup developing chips for Ethernet passive optical networks (EPONs), has enlisted chip veteran Rex Naden as its new CEO. Naden was brought in because of his experience with volume manufacturing, according to previous CEO Gerry Pesavento -- also known as a founder of Alloptic Inc. -- who remains "an advisor and supporter" of the company.

    Naden's most recent "volume" experience ended unfortunately, as he was chief operating officer for now defunct network processor firm Silicon Access Networks Inc. (see 2003 Top Ten: Startup Flameouts). His resumé includes stints at Atheros Communications Inc. (Nasdaq: ATHR), Stream Machines (acquired by Cirrus Logic Inc. (Nasdaq: CRUS)), VLSI Technology Inc. (acquired by Royal Philips Electronics N.V. (NYSE: PHG; Amsterdam: PHI), and Texas Instruments Inc. (NYSE: TXN).

  • The Force is weak with this one: Jedai Broadband Networks Inc. has hit hard times, according to several people close to the company. No one at the company could be reached for comment, but sources nearby say CEO Michael Pritz has sent the staff home until the company either secures a bridge loan or some other financing (see Jedai Still on Its Feet).

  • SpectraSale: SpectraSwitch Inc. has finally called it quits. About a week ago, the company began the process of trying to sell its intellectual property.

    SpectraSwitch's products, including variable optical attenuators and small optical switches, had made it to market. Some received Telcordia qualification and appeared in customer demonstrations at OFC. But the volumes the company had expected -- hundreds of thousands of units per year -- were never reached.

    "Our customers' products [that is, components and subsystems vendors] are being adopted at a slow rate, and the time it would take to ramp up to those numbers was too long for our VCs to stomach," says CEO Lindsay Austin. "They decided they would rather put their money in a bigger market."

    SpectraSwitch ran from the Reaper in 2002 by raising $7.5 million from Advanced Technology Ventures (ATV) and NIF Ventures, bringing its funding total to around $36.5 million (see SpectraSwitch Takes a Holiday and SpectraSwitch Scores $7.5M). The company had 10 employees upon calling it quits, Austin says.

  • Quitters never Quinn: Princeton Optronics Inc. has waved goodbye to its CEO, Andy Quinn, according to sources close to the company. Princeton didn't return Headcount's calls, but Headcount notes that Quinn's name was no longer in the company's automated telephone directory -- always an indicator of departure (IOD, for you acronym fanatics).

  • Everybody loves Romano: Earlier this month, Tropic Networks Inc. announced that Romano "Va-va" Valussi, president of Alcatel SA's optical networks activities, has joined its board of directors. Headcount remembers promising it would note this addition, but now we can't remember why.

    If nothing else, the last item is a nice signal that this column should end for now. But before we go, here are some of the other notable hirings and firings of late:

    • Agere Wields Jobs Axe

    • Market Yawns at Motorola Cuts

    • Lucent Cuts Target INS

    • CoSine to Cut Nearly Everybody

    • Net2Phone Shuffles CEO, Board

    • General Bandwidth Drafts New CEO

    • Band-X Exits IP Market

    • Qwest Quenches Fraud Probe

    • Telcordia: Bye Bye Borden

    • Telcordia CEO $trikes $ell-Off Deal

    • Nortel's Owens Joins Fat Cat Club

    That's all for this edition of Headcount. As ever, send your employment related news to [email protected].— Phil Harvey, News Editor, and Craig Matsumoto, Senior Editor, Light Reading

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