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Optical/IP

Headcount: Vendor Vivisection

The blades are falling.

Look for the biggest series of headcuts since Robespierre was in short pants as carrier consolidation continues this year – and as big vendor consolidation almost certainly follows.

Here’s the merger headless-count, so far: And with so much of the North American carrier capex now in the hands of so few companies, industry observers doubt that Lucent, Nortel, Redback, Avici, Carrier Access, Verilink, Sonus, and Paradyne will all end 2005 as independent companies.

And when those companies get together – or get snapped up – more citoyens will face the tumbril.

Right now, consolidation and job loss isn't exclusive to the telecom space. In January alone, U.S. employers conducted 1,457 mass layoffs -- the highest number in 12 months -- involving 150,990 workers, according to the latest info from the U.S. Bureau of Labor Statistics (BLS). The BLS measures the data by checking for new filings of unemployment insurance benefits and defines a "mass" layoff as one involving 50 people or more. There were 246 more mass layoffs in January than in December 2004. But January's numbers were nowhere near the mass layoff highs recorded in September 2001. That month saw 2,409 mass layoffs affecting 277,214 workers.

A similar picture is emerging on the other side of the Atlantic, where the Netherlands' KPN Telecom NV (NYSE: KPN) and Denmark's TDC A/S (Copenhagen: TDC) are among incumbent carriers announcing layoffs (see Eurobites: Mixed Fixed Fortunes).

It's tough stuff to ponder, but it only makes sense now that the efficiencies of all IP networks, outsourcing, and network intelligence have come home to roost.

While you're readying your office merger betting pools, we'll move on by bringing you the most interesting hirings and firings from the past few days:

  • Meriton's New Master: Anda Networks Inc. chairman Mike Pascoe has been tapped to be the new CEO of Meriton Networks Inc. The CEO job has been open there since Wes Biggs left the company sometime in 2002. Mike Gassewitz, the company's first chief operating officer, is still Meriton's president and COO. In his prior roles, Pascoe has been president and CEO of PairGain Technologies (acquired by ADC Telecommunications Inc.), and president of Newbridge Networks' U.S. division (acquired by Alcatel). Pascoe was at Newbridge from 1986 to 1998.

  • Yim and Yang: There's a whole lot of shaking up going on equipment maker Allied Telesyn International Inc. In October 2004, the company parted ways with its North American president and COO, Howard Kamerer, and the position is still open. According to sources close to the company, other departures from Allied Telesyn in the past few months include Don Trace, the company's senior VP of channel operations, and David Dowse, the president of Allied Telesyn Networks, the Raleigh, N.C.-based development center focused on the company's metro edge and access products. Additionally, say sources, Steven Shalita, the company's senior VP of global marketing and strategy, has moved on as well. Shalita replaced the company's last senior VP of marketing, Todd Chipman, back in October 2004.

    The only major executive appointment the company has made of late, was its February announcement that Turin Networks Inc. founder Philip Yim had taken the job of senior VP, global product development. Calls to Allied Telesyn's most recently listed media contacts were not returned.

  • Practice Makes Perfect: Last month, AT&T was named to The Telework Coalition’s Hall of Fame for its enduring support and practice of enabling employees to work remotely from company locations. In celebrating its induction, AT&T announced that 30 percent of its employees are full time from locations other than an AT&T facility and another 40 percent telework regularly. Given what's going to happen when the carrier merges with SBC, Headcount acknowledges there's a certain value in getting people to get used to staying at home all day.
  • French Kiss Off: VOIP gateway maker General Bandwidth Inc. has added more dollars and brain cells to its arsenal. The company announced today that it has bagged an $18 million funding round led by Oak Investment Partners and with participation from Sevin Rosen Funds, Venrock Associates, Invesco, Siemens Venture Capital (SVC), and others. This brings the company's funding raised to date to somewhere in the neighborhood of $188 million. Notably absent from the round was Alcatel, which, at the time of General Bandwidth's last financing, bought at least a 20 percent stake in the company at a pre-money valuation of $45 million (see Alcatel Reins In General Bandwidth). That, says the company, was by design. "Alcatel is a big strategic partner for us, but we feel we can be of value to other strategic partners as well," says Jody Bennett, GB's VP of marketing. In the brains department, the company has installed Calix Networks Inc. board member and former Alltel Corp. (NYSE: AT) executive Michael Flynn as a director, and it has formed an advisory board that includes a former Santera Systems executive, Abir Hnidi, and Patrick Smith, the former VP of systems integration and technology planning at Sprint Corp.'s Technology Services division.

    We wrap up, as usual, with a summary of other industry appointments and disappointments from the past few days:

    That's all for now. But it doesn't have to be. Keep those news tips coming to [email protected].

    — Phil Harvey, News Editor, Light Reading

  • rocksolid 12/5/2012 | 3:24:56 AM
    re: Headcount: Vendor Vivisection Funny this hasn't been reported, but Luminous' new CEO Chris Stark has been cleaning up the exec team.

    Charles Barry, formerly brilliant co-founder and CTO has been let go. Not surprising given his arrogance.

    Gone is Bill Reid, VP of Worldwide Sales.

    They also don't seem to have any VP of marketing - when did Brian Noel leave?
    ceoati 12/5/2012 | 3:24:56 AM
    re: Headcount: Vendor Vivisection All but one of the people who "left" were fired. Lots of layoffs, too. The damage inflicted by irrational management over the last two years is showing its face.
    fiberous 12/5/2012 | 3:16:26 AM
    re: Headcount: Vendor Vivisection What is happening with Luminous?
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