Headcount: Scary Times Continue


Halloween has passed, but the telecom world is as scary as ever. Here's a rundown of last week's hirings and firings, via "Headcount," our new editorial vehicle whose tires are being constantly kicked:

  • The artist formerly known as Williams – WilTel Communications Group Inc. (OTC: WTELV) – has handed the reigns over to a rookie. Jeff Storey succeeds Howard Janzen, who piloted the company to bankruptcy, as WilTel's new CEO and president (see Williams Bolts Out of Bankruptcy ). This is a pivotal moment for WilTel. Storey has never been in the chief's chair before and WilTel is fresh off a Chapter 11 exit with $375 million in funding. So why are Wall Street's yawns so deafening?

  • Alcatel SA (NYSE: ALA; Paris: CGEP:PA) says it will cut about 1,000 positions, or 13 percent of its overall U.S. workforce, by the end of the year.

  • LuxN Inc. has cut some heads recently, bitterly explaining that recent reports of its inroads with SBC Communications Inc. (NYSE: SBC) led to increased competition from Nortel Networks Corp. (NYSE/Toronto: NT) (see Sources: LuxN Close to SBC Deal). "Like any other company in this industry we've had to readjust and cut budgets," says Paul Zalloua, LuxN's VP of marketing.

  • Lynx Photonic Networks now employs 58 workers, down from 75 just a few days ago. The company has "taken the important strategic decision to ensure that the current funding level, in 'worst case scenario' planning, takes Lynx into 2006 and beyond," writes Dick Sadai, the company's former senior VP of business development, in an email note to just about everyone.

    Regrettably, Lynx PR maven Kelly Williams was one of the full-timers cut. Williams was always – well, usually – a good sport when Light Reading picked on Lynx for its hairline, its headlights, or its cracked rear-view.

  • Headcount hears from several sources that Rapid5 Networks Inc. has shut down. It's not clear how many jobs were affected. In August 2001, Rapid5 said its then spanking new digs could accommodate up to 150 employees.

    The company hasn't returned calls yet, but PR guy Matt McGinnis admits he's no longer pulling a paycheck. "I'm not going to be able to comment," McGinnis says. "I have my hands tied." Headcount wonders how he picked up the phone.

  • What in the Wide, Wide World of Sports is going on at Lucent Technologies Inc. (NYSE: LU)? Light Reading has reported that up to 180 jobs may have been snuffed, as the company ditches its TMX 880 business (see Lucent Chops TMX 880). Still, our sources won't stop dropping hints that another shoe is about to drop. Will Cisco Systems Inc. (Nasdaq: CSCO) and Sycamore Networks Inc. (Nasdaq: SCMR) buy a chunk of its ATM unit (see Cisco, Sycamore Circling Lucent's ATM)? Is Lucent's SpringTide product about to wash ashore and die of loneliness? Stay tuned.

  • Several publications have reported that Catena Networks Inc. has cut more employees, this time as many as 50 people. Voila! We have just become one of those publications.

  • Kestrel Solutions Inc. has reached the next chapter in its life story: Chapter 11. The company filed for bankruptcy protection in San Jose on October 21.

  • Finally, is Zhone Technologies Inc. close to acquiring Corona Networks Inc.? Sources say Corona employees are fearing the worst because Zhone's modus operandi is to follow a buy with a big swing of the axe. Zhone won't confirm or deny the rumor, but it wouldn't end a call without exuding some cockiness. "We've done seven acquistions to date," says Zhone marketing VP David Markowitz. "Who will get to be lucky number eight? It's been three months – I think we are probably due for another one."

  • In the telecom world, says one glum PR wag, "things would have to improve dramatically just to suck." Headcount couldn't agree more.

    — Phil Harvey and Marguerite Reardon, Senior Editors, Light Reading
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    DarkWriting 12/4/2012 | 9:24:49 PM
    re: Headcount: Scary Times Continue What happened to the posts about Brocade layoffs.

    achorale 12/4/2012 | 9:24:48 PM
    re: Headcount: Scary Times Continue Can you send me some of the stuff you have been smoking?

    i'm putting every free dollar into tellium. it's the safest optical company to be in right now.... still have over $billion in backorders and is #1 in the rapidly growing wavelength grooming switch market!!!! TELM to $10!!!! get in now!
    PRMaven 12/4/2012 | 9:24:45 PM
    re: Headcount: Scary Times Continue Phil and LR Staff:
    Thank you for the kind words, but please let me clarify, I was ALWAYS a good sport. Lynx has made some prudent budget decisions that allows them to ride through this wave of an industry recession. However, I am still on contract with Lynx to continue to support their continuing marketing efforts.

    With hard times, comes opportunity. With Lynx as our first client, I have started my own communications consulting business (yet unnamed). Our goal is to help small start-ups, who don't have budgets for full-time staff, have as fun of a relationship with LR, and others, as Lynx continues to enjoy. Services will encompass both marketing communications and public relations.

    I'll be seeing you soon....
    PR Maven
    sir-wish-pro-wide-her 12/4/2012 | 9:24:43 PM
    re: Headcount: Scary Times Continue what tree did you fall off of? Let me guess. Either you are employed with them, or are an existing investor or have just got a call option on that company or have a friend who works for them that you are trying to help save his/her job.
    Iipoed 12/4/2012 | 9:24:43 PM
    re: Headcount: Scary Times Continue Every analyst is pushing strong sell. What do you know that the rest of the world does not. Hope you did not spend money exercising your options above TELM's current value. AMT = ouch.
    techoriginol 12/4/2012 | 9:24:39 PM
    re: Headcount: Scary Times Continue Haven't we heard this song before? Anything to impress the venture capitalists
    that are stupid enough to invest in Zhone. Watch what will happen:
    - The stinkers running Zhone will give the newly acquired employees a pep talk about
    what a future they have with Zhone and how everyone will soon get rich with stock
    options once the company goes IPO.
    - As soon as Zhone legally can they will lay off the bulk of the employees,
    especially the ones that actually contribute to the product line and can keep
    the product developing. Yes the jet setters that do nothing 'cept fly around on private
    jets and occupy empty offices will stay.
    - Zhone will keep a small group of so called core employees so that they can show the
    investors that yes they have all these fabulous access that can take care of all the
    customer needs (remember MALC, NT's Access line etc). All they're doing is creating
    an illusion that they are moving "full steam ahead" when all they really have is a ghost
    ship barely inching along.
    - In reality the only thing that Zhone ends up with are labs full of archaic aging junk
    and no one to support these products or further develop them or for that matter to
    even repair the stuff. Also venture capital disappearing sooooo fast that you couldn't
    flush the money down the john fast enough.
    If you were an investor, customer, enginner or technician would you really wanna deal with
    these monkeys? They develop practically nothing, eat venture capital, fire engineers and developers and pretend to actually know something. Yes they did get real lucky once with their buddies at Lucent.

    Marguerite Reardon 12/4/2012 | 9:24:33 PM
    re: Headcount: Scary Times Continue We're looking for more news on layoffs and notable hires throughout the industry. We're trying to run an update every friday. So if you have heard anything please let us know so we can check it out. Email [email protected]

    lightFleeting 12/4/2012 | 9:24:32 PM
    re: Headcount: Scary Times Continue You have to sell the shares in order to call it a loss. Your loss will be the difference of your buy/sell. You can then deduct up to $3k/year on your federal tax return.

    plumpy 12/4/2012 | 9:24:29 PM
    re: Headcount: Scary Times Continue Calling Zhone management monkeys is an
    insult to all primates.

    Reptile or sediment is probably the
    right species.


    Ex-Cenix 12/4/2012 | 9:24:28 PM
    re: Headcount: Scary Times Continue 40% of reduction of work force mostly engineers. Don't know if any more will occur from now until the end of the year.

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