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Optical/IP

Nortel Changes CTO – Again

It's not quite the invasion of the Pod People, but Nortel Networks Ltd. (NYSE/Toronto: NT) executive ranks are filling up with Cisco Systems Inc. (Nasdaq: CSCO) veterans, as Nortel today hired yet another new chief technology officer.

Effective April 4, the CTO will be Gary Kunis, who was Cisco's chief science officer until 2002. He will report to Gary Daichendt, the former Cisco executive VP who became Nortel's president and COO just this month (see Nortel Swaps Out CTO and Ex-Cisco Exec Named Nortel COO).

Nortel officials weren't available for comment. A Nortel spokeswoman confirmed Daichendt and Kunis knew each other at Cisco, though, so it appears Daichendt wants a familiar face in the ranks. Either that, or he's trying to pack Nortel with guys named Gary.

Former CTO Brian McFadden has not been sent to the graveyard of non-Garys. He's moved to the post of chief research officer (CRO?) and will continue to report to Daichendt.

Nortel has now changed CTOs twice in six months. McFadden, formerly president of Nortel's optical networks efforts, had just signed on in October to replace Greg Mumford, who had held the post since late 2001 (see McFadden In, Mumford Out as NT CTO and Nortel Bets on Mumford).

That Daichendt and Kunis hail from Cisco is significant, although it suggests two opposite paths Nortel could follow, says Steve Kamman, analyst with CIBC World Markets. One is to "double down" on enterprise and IP -- Cisco's specialties -- probably with some LAN or wireless acquisitions to flesh out the portfolio. Then again, he says, it's possible Nortel is moving itself away from those areas, hoping Daichendt and Kunis can seed an alliance with Cisco.

Either way, "I do think it points to [CEO Bill] Owens putting his own stamp on the company, which is a good thing," Kamman says.

Other recent executive changes by Nortel include the replacement of the company's CFO and controller (see Nortel CFO, Controller Step Aside). Investors seemed fairly unphased by all this executive-shifting excitement. Nortel stock traded down 9 cents (3.2%) at $2.73 late this afternoon.

— Craig Matsumoto, Senior Editor, Light Reading

edgecore 12/5/2012 | 3:20:38 AM
re: Nortel Changes CTO – Again Nortel will never be like Cisco, so let's get real.

1- Revive confidence in wireless customers that NT is around for a while

2- Close down MPE9000

3- Reduce the supply manageent empire by 50% and focus on new technology

Cheers,

EC
PO 12/5/2012 | 3:20:37 AM
re: Nortel Changes CTO – Again I would hope Mr. Kunis can bring more data networking leadership into the office of the CTO than Nortel has demonstrated in the past.

Can we look forward to an exclusive LightReading interview early next week, as we did with Mr. McFadden? :)
inauniversefarfaraway 12/5/2012 | 3:20:36 AM
re: Nortel Changes CTO – Again Let's see, Nortel selling out to Huawei, or Cisco finally getting "into" telco's?

Anyone hearing wedding bells? Who will be the bride this time?

Cisco's been toying with wireless networks, why not take the next step with WWWN's?

sunfanz 12/5/2012 | 3:20:36 AM
re: Nortel Changes CTO – Again EC

Got a good suggestion on plan A. Here is my take on plan B.

1. Spin off Enterprise.

2. Sell Wireline and Optical to Huawei.

3. Resell Huawei in Mobility's packet core.

Be true to yourself, do not play imitation, you cannot be Cisco.
networkbuff 12/5/2012 | 3:20:36 AM
re: Nortel Changes CTO – Again I don't know about 1 and 3, but 2 will happen sooner than you think. I heard they canceled Broadband and Ethernet services on MPE9000 already and that people are leaving in droves. I won't be surprised if it goes on backburner just like Optera and HDX did a few years ago.
xbar 12/5/2012 | 3:20:33 AM
re: Nortel Changes CTO – Again >I would hope Mr. Kunis can bring more data networking leadership into the office of the CTO than Nortel has demonstrated in the past.

Don't hold your breath. What he brings is a big mouth, not there is anything wrong with that.
Physical_Layer 12/5/2012 | 3:20:33 AM
re: Nortel Changes CTO – Again Hey Edgecore - just curious why you think NT should shut down MPE. I've been out of Nortel since before the bubble burst so I'm not that close to things but I seem to remember the PP15k team was very strong and I heard many of those guys are now on Neptune.

What's wrong with the product?
(not arguing - just don't know)
Telecom_Design 12/5/2012 | 3:20:19 AM
re: Nortel Changes CTO – Again Admiral Owens's recent appointments from Cisco reflect his end-game efforts to hang on as CEO. In the admiral's favor, the new COO and CTO set in place at least at the resume level a future succession team to potentially drive forward new product, technology and partnership visions.

The current frontline team is clearly not delivering. Non-technical McFadden, whose claim to fame was successfully managing Long Haul during the boom years, was clearly out of his depth as CTO. He has now been effectively demoted and left to manage as CRO a downsized shell organization(with the possible exception of stand alone Wireless). With McFadden rapidly approaching retirement, I would be surprised if one of his last roles wasn't that of the heavy eliminating positions, especially hardware, in his advanced technology group.

Clearly, rough seas lie ahead for Nortel as the distractions shift from accounting irregularities to class action suits in the presence of an already demoralized design community that is currently losing market share (even in the corporate-critical wireless area) to growing competition. The new COO and CTO have major challenges dead ahead.
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