x
<<   <   Page 3 / 4   >   >>
laserbrain 12/5/2012 | 12:02:18 AM
re: Alcatel & TiMetra Seal the Deal HG - your analysis is reasonably accurate, but none of the risks you point out in and of themselves make it a bad deal. The valuation seems to indicate that ALA was convinced (rightly or wrongly) that the risks were somehow mitigated...

1) only have prototypes today.
>> this is one that I can't compute in that you could swag a valuation based on 4x next year's sales, which would imply that TiMetra is expecting $37Mil next year. If they have only a trickle of revenue now, that's way out of whack. I'd expect this metric to imply ~$50mil price tag.

2)Risky technology bet. TiMetra have pretty much hung their hat on VPLS
>> This is a minor risk. a good architecture can implement the necessary standards if their bullseye was off a bit.

3) Risk missing an opportunity.
>> got the opportunity costs with any decision you make...

Anyone like to comment on TiMetra&#8217;s IP experience or their engineers track record?
>> definite top-notch. The key for ALA here, is does the deal lock in the good guys? If Basil is only around for a year and his best guys go with him, then the deal is worthless. You gotta buy the team for the next gen product. If they landed the team commitment, then maybe this goose the price. (Up $100mil more?? I dunno)

And finally, if TiMetra are buying in their IP routing code then again I'm not sure how exactly this helps Alcatel strengthen their IP portfolio.
>> everyone buys routing code. RIP, OSPF, BGP are essentially commodities. The value in these boxes have very little to do with routing protocol.

-Lb
skeptic 12/5/2012 | 12:02:17 AM
re: Alcatel & TiMetra Seal the Deal And finally, if TiMetra are buying in their IP routing code then again I'm not sure how exactly this helps Alcatel strengthen their IP portfolio.

>> everyone buys routing code. RIP, OSPF, BGP are essentially commodities. The value in these boxes have very little to do with routing protocol.
===================

You are totally wrong. Routing protocols,
except at the low-end of the market, are NOT
commodities. If you think of them that way,
you will fail.

Its the box that has little to no value and
is made up of mostly commodity components.

verstand 12/5/2012 | 12:02:16 AM
re: Alcatel & TiMetra Seal the Deal light-headed,

Don't pick on BobbyMax! Be a gentleman, will you!
light-headed 12/5/2012 | 12:02:05 AM
re: Alcatel & TiMetra Seal the Deal skeptic,

I know that your opinion is always right but you are wrong in your recent comments. Both HW and SW is important and historically HW has been more important. Not everyone out there can produce a high-speed internet router with a programmable forwarding plane and wire-speed throughput.

Almost very deal cisco ever lost was because their HW was not up to snuff so when the greatest routing and switching company in the world cannot produce anything but mediocre HW i dont see how you can say it isnt important.

Every deal cisco ever won was due to financial, relationships or IOS. The HW was rarely the winning factor.

Thus i would say that both HW and SW are very important. If you commoditize HW, SW or both you will have a very mediocre product or a simple SOHO product. (netgear)

Furthermore how many routing and switching startups were purchased because they had great code??? Very, very few. Think about Kalpana, Crescendo, Centillion, Xylan, Lightera, etc. You need to get out of your Cisco/Juniper centric view of the world.

Also to the Laserbrain... if you read this article you will see that TiMetra did do some protocols from scratch. Only a few companies have done that to date. I can think of Cisco, Juniper, Proton, Wellfleet, Procket and maybe Siara (Redback) but even some of those companies bought 3rd party stacks.

http://www.lightreading.com/do...

From what i have heard this is a very good deal for both companies. Maybe the smartest move Alcatel has made in a long time.
dbostan 12/5/2012 | 12:02:00 AM
re: Alcatel & TiMetra Seal the Deal light-headed, you forgot to add Allegro as a company that developed the routing stack from scratch.
skeptic 12/5/2012 | 12:01:59 AM
re: Alcatel & TiMetra Seal the Deal
Furthermore how many routing and switching startups were purchased because they had great code??? Very, very few. Think about Kalpana, Crescendo, Centillion, Xylan, Lightera, etc. You need to get out of your Cisco/Juniper centric view of the world.
------------------------

Turning your argument around, the reason that
Juniper wasn't purchased as a startup and went
on to spectacular growth was becase it DID have
routing software that worked.

Contrast that with bottom-feeders like Xylan
who were trapped in a certain portion of the
market (i.e. "we sell bad gear cheap")
because they could not even really
function as a router in addition to having low
quality software overall. The reason why Xylan
was aquired was in no small part because the
alternatives who had far better routing code
(i.e. redback) were priced at multiples of what
Xylan was eventually acquired for.

I'm not saying that success is impossible without
good routing code, but if you make that decision
it has long-term consequences. Foundry and
Extreme are successful, but they are (again)
trapped in certain segments because of bad
decisions they made.

Now there are cases where you dont need routing
code (i.e. Creshendo). But they are getting to
be very few and far between.

---------
From what i have heard this is a very good deal for both companies. Maybe the smartest move Alcatel has made in a long time.
---------

I think alcatel will likely tear them apart.
Its going to be great financially for the
people at Timetra, but as soon as the planeloads
of experts from europe start arriving to "help"
things will start going bad. The same people
who made all the mistakes a few years ago are
still making all the decisions today.

And a certain large ego at Timetra would do well
to talk to Bernard Danies or to at least learn
from what happened to him.

Gigaboy 12/5/2012 | 12:01:56 AM
re: Alcatel & TiMetra Seal the Deal >> definite top-notch. The key for ALA here, is does the deal lock in the good guys? If Basil is only around for a year and his best guys go with him, then the deal is worthless. You gotta buy the team for the next gen product. If they landed the team commitment, then maybe this goose the price. (Up $100mil more?? I dunno)


Take the money and run. Just a tip, from
experience in this department. With Alcatel there is no second generation equipment. They will bog it down and cancel it mid development so many times that it will just kill the company. Slowly over time disillusioned engineers will quit, tired of having Dirk's crap architectures and losy code shoved down there throat in the interest of having "one Architecture".Avoid the slow death that only awaits in dealing with Alcatel. Been there done that!
priam 12/5/2012 | 12:01:55 AM
re: Alcatel & TiMetra Seal the Deal Who knows, maybe Alcatel's learned something.

From a distance, their acquisition history:
Packet Engines - a disaster
Xylan - merely crappy
Newbridge - going reasonably smoothly? Or not. I'm sure someone has the scoop ;-)
Anyway, g'luck to them all....
gigeguy 12/5/2012 | 12:01:54 AM
re: Alcatel & TiMetra Seal the Deal Perhaps this is a bit backwards ... first you sell the company and then you launch it .... but TiMetra will be doing a major company launch at Supercomm, including announcing multiple customers, one of which is a nationwide US plus international carrier that starts with the letter "M". No guessing, now! TiMetra also has gear in the interoperability booths at Supercomm. So Alcatel doesn't have to worry about the equipment working.
dwdm2 12/5/2012 | 12:01:52 AM
re: Alcatel & TiMetra Seal the Deal "Who knows, maybe Alcatel's learned something.

From a distance, their acquisition history:
Packet Engines - a disaster
Xylan - merely crappy
Newbridge - going reasonably smoothly? Or not. I'm sure someone has the scoop ;-)..."

What about Kymata? Looks like ALA really gained some awesome technology. My question is: are they making any good use of it?
<<   <   Page 3 / 4   >   >>
HOME
Sign In
SEARCH
CLOSE
MORE
CLOSE