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Optical/IP

Headcount: Job Count Friday

The U.S. unemployment rate remained at 5.4 percent in September, according to the latest Labor Department numbers.

But can anybody in the telecom industry really believe what the gum'mint sez?

The federal Bureau of Labor Statistics (BLS) said there was a net increase of 96,000 (non-farm) payroll jobs during the month, which was less than August's rise, which was revised down in Friday's report from 144,000 to 128,000.

The neat thing about the news is that the numbers come on the eve another Presidential debate, so you can be sure the spinmeisters are busy prepping the data as their own political football.

Here's one bold fact, though: The U.S. appears to be losing jobs faster than it is adding new ones. Although 1.8 million jobs have been added to the payrolls of U.S. businesses since August 2003, there are about 800,000 fewer jobs overall than when the current adminstration took office in January 2001, according to a report by The Associated Press.

Meanwhile, in the telecom world, of course, the employment situation isn't rosy at all. Telecommunications employment fell by 9,000 in September, according to the BLS. Since March 2001, the telecommunications industry has shed 302,000 jobs.

Labor Secretary Elaine Chao says that, in the right context, stagnation is not a bad thing. "The economy has been through a great deal lately — devastating hurricanes and rising oil prices," Chao says in a statement. "Yet the unemployment rate remains at 5.4 percent, and 96,000 jobs were created last month."

Interestingly, the BLS, in its assessment of the hurricane impact on employment, says that the severe weather didn't "change materially" the September employment data on a national level.

While you spin that data to your political leanings on the boards below, Hurricane Headcount will keep plodding along, providing another dose of recent hirings and firings:

  • Ciena Remodels Marketing Dept.: Ciena Corp. announced this week that it has named Laura Howard as its new senior VP of marketing and moved Suzanne DuLong, VP of investor relations, to the position of chief communications officer. Both executives report directly to CEO Gary Smith (see Ciena Beefs Up Marketing).

    DuLong will still oversee investor relations, Ciena says, but her duties have been expanded to include building the company's perception with the media, industry analysts, and employees. So it's a promotion. And that's a good thing. And those tears are tears of joy. Got that?

    Not announced was that Bob Sullebarger, the former VP of marketing for defunct Équipe Communications, has surfaced as VP of product marketing for Ciena's Data Networking Group.

    Yes, Ciena has a data networking group. Stop rolling your eyes.

  • An RBOut at RBN: Jim Fultz is out as CEO of RBN Inc., Headcount has learned. His replacement, Graham Mitchell, is listed on RBN's Website, but no bio is available. Fultz took the top job at RBN only a little more than a year ago. His previous gigs – each of which lasted two or fewer years – were as CEO of AcceLight Networks, Zaffire (sold to Centerpoint Broadband Technologies Inc.), and Scion Photonics (sold to JDS Uniphase Corp.). (See Fultz Joins AcceLight as CEO, Scion Picks Fultz, and Zaffire Names New CEO).

  • Us and Them: An operations exec from Pembroke Telephone Co. told Headcount this week that rural customers simply prefer to talk to someone face to face. But, unfortunately, the Pembroke bloke went too far. Referring to his cable competitors, the executive chortled: "You pick up the phone with them sometimes and you can't understand what the Indians are saying."

    Headcount wonders: Why are the folks maintaining global communications networks seemingly not ready to embrace communicating with people in other parts of the globe?

  • Ma Bell's Pink Slips: AT&T Corp.'s (NYSE: T) decision to cut more staff than previously announced will saddle the company with a $1.1 billion charge in its third quarter. The carrier says it will whack 20 percent of its workforce – 12,200 people – by the end of the year, taking its headcount to fewer than 49,000. It had previously predicted an 8 percent chop.

    About 9,000 of those affected have either been notified or already left the company.

    The operator is also taking a non-cash charge of about $11.4 billion in its third quarter to take into account the reduced value of its assets caused by pricing pressures, the shift away from TDM voice services, and regulatory changes (see Ma VOIP? and AT&T Reduces 2004 Revenue Forecast).

    AT&T says its cost-cutting measures mean its net debt at the end of 2004 will be less than $7 billion, about half what it was 2 years ago.

  • Dutch Oven: In Europe, Dutch incumbent KPN Telecom NV (NYSE: KPN) is cutting 750 of the 2,700 jobs at its EnterCom Solutions division, which installs equipment and provides support services for business customers.

    About 140 staff will leave immediately, with the rest going in the course of the next year. KPN will take a €25 million ($30.9 million) charge against the cuts.

    KPN, which in 2003 clawed its way back into the black after a torrid few years, had already announced the loss of 800 jobs from its fixed-line division in January (see KPN Cuts 800 Jobs and KPN Reports Full-Year Profit). These latest reductions will take the carrier's total workforce down to about 28,000.

  • He's Going Global!: Allied Telesyn International Inc. has picked former Cisco marketer Steven Shalita to replace its outgoing senior VP of marketing Todd Chipman. Interestingly, Shalita's title – senior VP of global marketing and strategy – suggests that Allied Telesyn is trying to move its North America, Europe, and Asia groups closer together than they were in the past. Sources close to the company say it is realigning its sales groups to focus on its core enterprise and service provider customers.

  • Loooo-ceeennnt!: More info is trickling in regarding Lucent Technologies Inc.'s most recent restructuring (see Lucent Offshoring Wave Hits Hard). A source close to Lucent says about 60 people will be laid off from the CBX team in Westford before Thanksgiving and only the CBX 3500 Network Processor engineers and OS engineers will remain in Westford. In India, there are already more than 100 engineers developing and supporting Lucent's CBX 3500 and GX 500 series switches, the source reports.

    Lucent spokespeople have already commented in detail on their hiring & firing strategies, saying they are hiring globally where they see the need – see Lucent Offshoring Wave Hits Hard.

    Here are some other appointments and disappointments that have come into the jobs desk since the last Headcount:

    Please keep those news tips coming to [email protected].

    — Phil Harvey, News Editor, Light Reading

    Ray Le Maistre, International News Editor, and R. Scott Raynovich, US Editor, Light Reading, contributed to this report.
  • eltooguru 12/5/2012 | 1:11:51 AM
    re: Headcount: Job Count Friday Allied Telesyn also canned its COO, and a bunch of salespeople. Global this or global that, it's just card-shuffling of weak strategies.
    gtchavan 12/5/2012 | 1:11:49 AM
    re: Headcount: Job Count Friday Phily,

    Without much deciphering it is obvious that you are still dreaming of the 90's bubble. Can you tell me how could the Bush administration be responsible for the morons who run the telecom companies?

    In case you did not know here is exactly what is going on: the cable companies are steeling phone companies voice and broadband customers with tripple play offering. So instead of addressing the real problem, and upgrading their networks, telco's are actually spending advertising dollars to promote the dish as a feeble attempt to steel cable customers. Let see, now we got the wireline people promoting the dish people to install another conduit to people's homes, the same dish people who can also steel wireline's broadband and voice customers with their own tripple play offering.

    Exactly how moronic is this. Do these people deserve to survive as business entities? Sure as the cliche goes, the little guy gets canned so the executive keeps his fat check, but there are a whole lot more of these little people than the fat executives and they have to speak up while they are there or at least speak up when they are let go because the buffoons who run these companies must be exposed. I also know the nature of the telecom workers, they are either in unions trying to screw the company or are in management and got their nose so far up their boss's butt that they would need a rhinoplasty if their boss suddenly stopped. So don't hold your breath.

    Frankly I don't have any sympathy, and don't get me started with wireless and how Clinton adminstration with their stupid swords to plowshare program destroyed the TDMA standards and replaced with CDMA, which has trippled the cost of wirless infrastructure, with old TDMA, CDMA and now GSM all competing from the same fricking antennas. Today in the most propsperous country in the world no single wireless company has a decent coverage of any metropolitan area. This is the Clinton legacy.

    Phily, if you are still living in the 90's eutopia you better wake up because you already had your orgasm.

    cj
    BlueWater66 12/5/2012 | 1:11:39 AM
    re: Headcount: Job Count Friday BTW: Look out for a new wave of start-up closings....poor survivors. Most of the bubble VCs (1998-2001) have a 5 year limit on capital calls, and then another 5 years to liquidate all their assets.

    So....

    1998 class quit investing in 2003
    1999 - 2004
    2000 - 2005

    A good 60% of the VC industry is up against a wall (and VCs are real f#@%$#s when their lives are tanking). Without any wins, which is not uncommon, they can't raise a new fund. When the capital calls run out, they can't invest any more. AND (take careful note of this), THEY WON'T LET ANYONE ELSE INVEST IN THEIR START-UPS BECAUSE THEY NEED TO PREVENT PAY-TO-PLAY SENARIOS FROM DAMAGING THEIR CURRENT POSITION.

    So, almost every optical start-up that is left is in real pain. There is no joy in surviving and then being pushed into a living-dead, permanently for sale existence.....every board discussion demands reduced headcount and finding any extreme way possible to eliminate the need to raise more money.

    It is odd, but the VCs gut the survivors and there is nothing of real value left. Every acquisition is for pennies-on-the-dollar (or they eventually collapse). Ouch.

    PS: The VCs fidget and start shuffling management. I've notice a sharp increase in headhunters calling about positions in distressed start-ups. Very odd.....Also, didn't Picolight just shuffle it's deck chairs?
    txmoore 12/5/2012 | 1:11:38 AM
    re: Headcount: Job Count Friday "...how Clinton adminstration with their stupid swords to plowshare program destroyed the TDMA standards and replaced with CDMA, which has trippled the cost of wirless infrastructure, with old TDMA, CDMA and now GSM all competing from the same fricking antennas..."

    Interesting, could you please educate on the history here? Any relevant links to this story or related ones?
    particle_man 12/5/2012 | 1:11:36 AM
    re: Headcount: Job Count Friday BW,

    I tend to agree that there are a bunch of zombie start-ups still in the optical space. I also hear that the VCs have a ton of cash burning a hole in their pockets. Like in excess of $60B. Is that number off base? How does that correlate with your comments?

    Thanks, PM
    opticalPassion 12/5/2012 | 1:11:36 AM
    re: Headcount: Job Count Friday There is a startup doing DWDM in Fremont - Intellambda Systems. Anyone can comment on them? their products, and future?
    BlueWater66 12/5/2012 | 1:11:32 AM
    re: Headcount: Job Count Friday On paper, there is a lot "bubble cash" still available for capital calls but their time is running out. Also, VCs are in a strange bind... if none of the optical component companies are generating a return, calling in cash from their limited partners to continue fiber optic investments is tricky.

    The VCs live on their management fees. If they don't "call in" that cash, they can't draw their fees. So, a lot of them are rushing into other areas (such as medical) while they still have time to draw. If the limited partners start getting hostile, they also move to later stage deals that can withstand scrutiny (avoiding charges of fraud or incompetence).

    BUT- as I said in the last message, many of the bubble firms are at the end of their rope. Just like start-ups, a lot of new private equity firms appeared during the bubble. In that case, life suxs. Most of the VCs that really focused on optical components or systems are especially hurting..and willing to share the pain :-(
    Balet 12/5/2012 | 1:11:23 AM
    re: Headcount: Job Count Friday BlueWater66 wrote: THEY WON'T LET ANYONE ELSE INVEST IN THEIR START-UPS BECAUSE THEY NEED TO PREVENT PAY-TO-PLAY SENARIOS FROM DAMAGING THEIR CURRENT POSITION.


    BW66, you clearly know the VC's world first hand.

    We've been in the situation above.
    Half of a just merged company (the half, which was making a good product, by the way) was going to be dropped. Some people tried to pick that half up but a big VC said" No way!" Did not want to lose his old face in case the dropped half would have become a success.

    etherhead 12/5/2012 | 1:10:12 AM
    re: Headcount: Job Count Friday You missed a fair amount of the Allied piece...they just did a major sales and marketing layoff, a 20% layfoff of the Raleigh Access R&D facility, Howard the President who drove the Triple Play/Carrier piece is no longer there, the Carrier team has had a big shakeout, and channel is the name of the game again going forward. They are losing money Globally and hurting as well, purportedly.

    The Telco shakeout continues....too many players were in to survive.
    pillarman 12/5/2012 | 1:09:27 AM
    re: Headcount: Job Count Friday Carriers are gearing up to buy. Look at Verizon, SBC and Bell south. The tide is rising but Allied's boat sank because they hired an unqualified guy to run Telco sales. Wasted money, didn't close business and disrupted the organization. He was axed, too.
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