re: Photuris & SBC: The Inside StorySo the question becomes:
Should a startup be floated if they have nothing new to offer? What happens to entrepreneurship and creative ideas (research, there is only one bell labs and most of the products in telecom are mere enhancements to the first phone made) to make the world a better place?
re: Photuris & SBC: The Inside StoryFolks, One of seven's hot buttons seems to have been pushed. But seven does have a point.
Trying to make something different in an environment where development costs are high, timelines are long, but if you win margins make it worth it is a difficult proposition.
Does ODSI ring a bell with anyone? How about mesh networking? Selling only into greenfield networks? All optical? Optical switching? All big attempts. All best efforts.
But is the thinking on target?
What became popular? Narrowband messaging: IM, text messaging, blackberries, and the like.
What companies drove what became popular? Did it matter?
A peripheral question is not how to forsee what the next big thing will be, but how to have a product that enables the next big thing somehow. How will it address scalability, how rapidly can it be adopted? What is the learning curve for carriers? Comments? lollapalooka
How would you have counselled Ciena given that Nortel, Lucent, Fujitsu, Alcatel and Siemens had 'transport' products already deployed in RBOCs/PTTs at the time?
I guess it comes down to the definitions of things like 'transport' and 'different' and how much 'differentiation' is necessary to make a difference and who gets to decide? Please explain how you measure '10% better' and at what level of differentiation, and how you would measure it, that you feel is sufficient for a startup to succeed.
If you were to ask every startup that ever existed they would claim to have a 'unique' product. Who judges whether a product is 'incremental' or 'unique' or two products from different manufacturers are the 'same'? The answer is the customer, not you or I. If the customer decides that they don't need all the nice features of an incumbent's product then 10% worse might be the right answer provided there was an associated 'difference' in cost.
re: Photuris & SBC: The Inside Story"If any of the companies that you listed had more than chartware why do you think Photuris got so far in the process being a 'transport' startup?"
So Far? How far did they get? They are out of business having never made a sale.
re: Photuris & SBC: The Inside StoryYour recollection of history is a little different than mine. The 5ESS development started in the late GÇÿ70s (not GÇÿ90s). BUT, the 1AESS was a cash cow so business features were withheld until the late GÇÿ80s to keep it from eroding the 1AESS ROI.
The DMS-100 was first deployed in PacBell by a rouge VP in the LA LATA. Within one year of K-date that VP took retirement and became an NTI employee. Another dynamic that was occurring at that time was the RBOCs wanted to flex their muscle and show their independence from Mother, which meant shunning Bell Labs products.
As far as quality the 1AESS was demonstrateably superior in features to the DMS-100 until BCS-32 (~1992). The idiots at Bell only considered features not perception (analog was old, out moded). They have always been ignorant marketers and still are.
Bell Labs really screwed up with the Tandems. Again the folks who had P&L for the 4ESS artificially kept tandem functionality from the 5ESS in the early GÇÿ80s, because it was in a different department and different Executive Directors. This allowed the DMS-250 to take over the Access Tandem market in the RBOCs. And no self-respecting IXC (e.g. MCI and Sprint) would buy from AT&T/Bell Labs in the GÇÿ80s.
How does this help startups? Not sure except to point out that significant changes such as analog versus digital does sell. The reality was not in the features, but in the perception of reality.
re: Photuris & SBC: The Inside Story"How would you have counselled Ciena given that Nortel, Lucent, Fujitsu, Alcatel and Siemens had 'transport' products already deployed in RBOCs/PTTs at the time?"
Stephenpcooke, Yes long haul transport was an underserved market. But how much of CIEN's business is from the RBOCs? Even today its probably less than 20%! CIEN did not even win in the RBOCs, they won in the IXCs and during the bubble period - companies that will never return to health and times that will never repeat if we are lucky.
The telecom bubble caused not just overinvestment but also too many unqualified people to enter this industry.
Ciena had a unique technology. Wave Division Multiplexing. This technology was not used as a transport technology but an enhancer of fiber usage without construction. Nortel, Siemens, ya da ya da ya da did not have WDM technology. So, Ciena found a place and a customer (backbone at Sprint first then MCI) that needed this technology. There was competition only from different technologies.
So, lets roll forward. Photuris builds a mixed SONET and WDM product. Many people make those. They may not be as good as Photuris (or they might be better), but its a product category with many large suppliers. So, Photuris has no way of getting in except through "partnership" with a large supplier (which at the end of the day only makes sense in an M&A strategy - OEMs last till the big guy can dupe your product).
That is why startup odds are so long. You need to be going a path different than others. You need a unique concept. Some of those concepts succeed (Pairgain, Redback, Ciena) some fail. Once they have succeeded, the next challenge is convert a company that is in essence a product (riding a product life cycle) into a company that is an ongoing business. That is a separate challenge.
So, Ciena was nothing like the ongoing transport businesses. Photuris is a bit better than others (maybe). If you can't tell the difference between the truly novel and not truly novel, then I suggest you don't do startups.
re: Photuris & SBC: The Inside Story>You are both so wrong its unbelievable. > >How about the following two startups: Pairgain >and Redback. > >Both got deployments without partners, as >startups with RBOCs.
Seven - did you know that the only way Redback got into Verizon was through Nortel? My understanding is that in 1998&9 a large portion of Redback's revenue came through Nortel prior to Nortel's acquisition of Shasta.
In my opinion getting into Qwest in 1999 as a start-up wasn't that hard. Especially if you had KP as a VC.
re: Photuris & SBC: The Inside StoryAs for Pairgain, it didn't hurt that they had MIke Pascoe, who was gracious enough not to lie on his resume (or even inflate it--he's too classy to do bother). Mike was an ALA guy and the carriers respected him, knew he was for real and wouldn't try and sell them a POS, unlike 90% of the startup CEOs of the 90s, who were a bunch of BS artists and posers.
Hi dijvbsl,
Isn't now a perfect time??
1) Industry giant are arrogant in both technology and marketing
2) Emerging of new customers.
3) Technological dislocation...
Dreamer</there>