Is Lucent Sitting on OEM Surprises?
Scuttlebutt about the possibility of a matchup comes hot on the heels of Lucent's decision to halt development on its core ATM multiservice switch, the TMX 880 (see Lucent Chops TMX 880). Lucent has stated that it will OEM as needed to fill demand for integrated solutions.
Could Marconi top the list of possible partners? After all, Marconi is hawking a high-end ATM multiservice switch, the BXR-48000 (see Marconi Adds 'c' to Its OC192 and Marconi's Switch Gets Tolly-fied).
A pairing's not likely, some analysts say, given that Lucent cited lack of demand in discontinuing the high-end TMX 880. "I know Lucent's been looking [for OEM partners], but I really hadn't heard about Marconi," says Sam Greenholtz, senior analyst at Communications Industry Researchers Inc. "It just doesn't make sense... Lucent has a tough enough time selling what it's got. Why put another vendor name out there if demand isn't there?"
Some skeptics, speculating that Lucent has been trying to hide its own lack of traction behind demand rhetoric, say a Marconi deal might not be so outlandish. "The TMX didn't seem to play well," says Brent Wilson, analyst at Current Analysis. Lucent might be better off to go with a partner and spin development cycles on tight integration, he says, than to struggle uphill on its own.
One source says word of a Marconi deal may have started as a suggestion in the wake of Lucent's latest cuts. "You know how these things work," said one source familiar with Lucent, who asked not to be named. "Bankers come up with an idea they hope to fund, then suddenly a rumor makes the rounds."
Still, few observers contacted for this article deny that there's a lot of talk about just how Lucent will fill the holes left in its product line -- holes made in the course of the company's ongoing "rationalization" process (see Lucent Pulls LambdaManager, Lucent Clarifies Product Strategy, and Lucent Silences SpringTide). Word is, if a Marconi deal isn't in the works, Lucent's probably planning other partnerships, given its new emphasis on services and integration.
"Lucent has to do something," says Susan Eustis, president of Wintergreen Research Inc., a telecom consultancy. Demand is growing for gear that can help carriers make the transition to MPLS and Gigabit Ethernet, she says, and Lucent needs to be able to fill the gap.
"There may be an opportunity for Marconi, but it would be one of many," says Frank Dzubeck, president of Communications Network Architects (no Website), a consultancy in Washington, D.C. Lucent's new focus on integration and services makes it likely the company will look for numerous OEM deals, he says, even in areas where its own products have failed. This strategy would help Lucent save money on development and support of "iffy" offerings, enabling it to stick to its chosen knitting. "Lucent's forte is project management," he notes.
Interestingly, when discontinuing the TMX 880, Lucent said it plans to release an ATM multiservice edge product at an unspecified future date. More grist for the partnership rumor mill?
— Mary Jander, Senior Editor, Light Reading