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Lucent Chops TMX 880

Light Reading
News Analysis
Light Reading
10/30/2002

Lucent Technologies Inc. (NYSE: LU) has stopped development on the TMX 880, the high-end ATM switch that was meant to help the company meet hoped-for demand for multiservice, MPLS-based products.

Lucent says on Friday it notified an unspecified number of employees, mostly at its data networking division in Westford, Mass., that they will be laid off. Another industry source put the layoff figure at about 180 people.

The news follows word that Cisco Systems Inc. (Nasdaq: CSCO) and Sycamore Networks Inc. (Nasdaq: SCMR) are homing in on other Lucent ATM assets, also based in Westford (see Cisco, Sycamore Circling Lucent's ATM). It also puts fresh life into ongoing talk that Lucent has stepped-up its house-cleaning to purge other product lines, including the services router Lucent bought with its purchase of SpringTide (see Springtide Ebbing Away?).

The move raises questions about Lucent's future strategy, questions that last week's update on product rationalization by CEO Patricia Russo failed to clarify (see Lucent Clarifies Product Strategy). At least one source, who asked not to be named, thinks Lucent's stripping down for the ultimate garage sale. Others have speculated that it is moving to an exclusive services model.

Let's take those one at a time, TMX first: Despite discontinuing the TMX 880, which had no announced customers, Lucent insists it's still in the legacy-to-packet migration hunt. "We will continue to invest in MPLS and multiservice networks," says spokesman Mike Alva.

Specifically, he says Lucent plans to release a "next-generation edge product," as yet unannounced.

Will the TMX 880 be sold as part of the other ATM gear that's supposedly making the rounds at Cisco and Sycamore? Lucent won't comment on that, calling it speculation. But Alva says the company will look into partnerships of all kinds wherever it sees a clear market opportunity.

What about SpringTide? No comment from Lucent there. But at least one source says the service router that comprised the key SpringTide product is likely to be discontinued in its present form.

"The original SpringTide product actually competed with other products from the company. Its functionality will be included in the new multiservice equipment," says Frank Dzubeck, president of Communications Network Architects.

Analysts don't think Lucent's aiming to end up productless. According to Dzubeck, Lucent's likely to use the money from the sale of its ATM gear to help pay its debt. But it won't give up its focus on products.

Analyst Stephen Levy of Lehman Brothers concurs. "We've said this restructuring will be defined by cutting products, that it will be very different from previous restructuring," he notes. Before, Lucent was cutting off skin and fat; now it's hacking off limbs, he says -- amputations that will ensure its ultimate survival.

As to dissolving its products one by one: nonsense, Levy says. "To me, the core of the company is in its pure CDMA products, services, and voice switching. I don't see those going." Everything else, though, may be open to question.

— Mary Jander, Senior Editor, Light Reading
www.lightreading.com

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BobbyMax
BobbyMax
12/4/2012 | 9:26:42 PM
re: Lucent Chops TMX 880
Lucent should not sell TMX 880 either to Cisco or Sycamore. No deal should be made with Cisco because possible pilferage of hardware and software. Sycamore can be given right to sell the product for a fixed yearly fee.

No products should be sold by Lucent except the ones acquired throgh acquisitions.
OEO_mon
OEO_mon
12/4/2012 | 9:26:41 PM
re: Lucent Chops TMX 880
Bobby Max says:
Lucent should not sell TMX 880 either to Cisco or Sycamore. No deal should be made with Cisco because possible pilferage of hardware and software.

This is backwards. The hardware is laughable, the architecture uninspired. The software has been worked on incessantly. The original product was barely working (although the Nexabit folks were proud enough of it, it had little innovative content) when Lucent bought the "prototype sold as a product".

Quote 2:No products should be sold by Lucent except the ones acquired throgh acquisitions

.... Which is exactly what this box is. If Lucent wants to slow down the competition enough to gain on them, I would encourage them to try to give this product away to them. By the time a competitor gets this one working, it will be obsolete and Lucent may have a chance of gaining market share with a more inspired offering.

I calls em as I sees em (and saw this one too close-up to be proud of it)

OEO_mon
fleshpeddler
fleshpeddler
12/4/2012 | 9:26:37 PM
re: Lucent Chops TMX 880

Come on, bottom line is the people that did due diligence on Nexabit in the first place should be in jail.
go_to_the_light
go_to_the_light
12/4/2012 | 9:26:36 PM
re: Lucent Chops TMX 880

how can lucent say that the legacy<->mpls thing is not going to be "worth it" yet ciena is into it with equip and wavesmith?
porn starr
porn starr
12/4/2012 | 9:26:35 PM
re: Lucent Chops TMX 880
Lucent's doing the right thing, Ciena seems pretty desperate, they dont know the first thing about MPLS.
greybeard
greybeard
12/4/2012 | 9:26:33 PM
re: Lucent Chops TMX 880
> Despite discontinuing the TMX 880, which had no
> announced customers, Lucent insists it's still
> in the legacy-to-packet migration hunt. "We
> will continue to invest in MPLS and
> multiservice networks," says spokesman Mike
> Alva.
>
> Specifically, he says Lucent plans to release
> a "next-generation edge product," as yet
> unannounced.

Can anyone explain why their alleged future effort in MPLS (or IP) is going to be any more successful than their past efforts in this space?
seeallwan
seeallwan
12/4/2012 | 9:26:32 PM
re: Lucent Chops TMX 880
Not much to say on the TMX880 except it was a router and always was a router no matter what label they stuck on it. It wasn't designed to be a Multi-Service ATM switch, period. It had serious HW/SW flaws from the beginning, so making it into an ATM switch was a very poor decision by Lucent (INS) management.

When LU canceled the "MSC25000/OZ" switch, they claimed that they sent surveys to it's legacy Cascade customers and they (the customers) came back and said "ATM is dead", we'll deploy IP/MPLS.

The market didn't cancel this box, the lack of experienced Westford management, a weak CTO, lack of vision, politics and the suicidal risks taken to cap further CBX/GX development put them in this position. All appointed by Ken and Janet.

The next agenda for Lucents data segment...OEM or sell, which is it? Stay tuned...

If my sources are even close, I hear Lucents Next-Gen Edge Product is in stealth mode and most likely won't be out for another 1.5 years?
It's another joint development attempt across 3-4 business units in MA/MD/NJ and IL, so the politics alone will squash any hopes of it seeing the light of day?

Anyway, the damage is done in Westford, it's just a wait and see game now.

ivehadit
ivehadit
12/4/2012 | 9:26:28 PM
re: Lucent Chops TMX 880
i agree with seeallwan. tmx880 was a high speed router, and its bad strategy to go head to head with cisco and juniper in that space. lucent tried to market it as an mpls switch, but no one is buying that either. cisco will build next generation mpls networks, with juniper in tow. thats a market given.

i don't believe the stories lucent is selling its atm business. its planning on a new edge box to firm up that offer.
BlueWater66
BlueWater66
12/4/2012 | 9:26:20 PM
re: Lucent Chops TMX 880
On the product side, I'm surppised that the INS-Nexabit related products lasted this long.

On the "management" side, I don't understand Pat Russo at all. In a "properly" run company you sometimes have to make cuts. Life at Lucent stinks, so they have to make deep cuts. But- a decent management team does this all at once. After the cuts are made, you tell the remaining employees that they are "special" and get moral back up.

Lucent, on the other hand, is cutting employees every Thursday. Employees are afraid and completely distracted. They aren't productive. Pat Russo emphaized in Business Week that she's going to keep making cuts on a regular on-going basis. If I were on the board, I'd kill her. This is an extreme example of management that doesn't know how to re-size and then re-focus their team......... just like product strategy, employee management requires strategy and focus. Pat is pathetic (just ask any Lucent employee!).
joke
joke
12/4/2012 | 9:26:19 PM
re: Lucent Chops TMX 880
>Come on, bottom line is the people that did due diligence on Nexabit in the first place should be in jail.

We totally agree with you. Look at those people (should be responsible) at http://www.tellium.com/.
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