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Nortel Seeks Marketing Makeover

With layoffs, accounting troubles, and tough competition all 'round, Nortel Networks Ltd. (NYSE/Toronto: NT) needs more than a quick pampering at the spa. A makeover might be a good step, however, and in that light, the company launched a marketing and branding campaign today (see Nortel Launches Ad Campaign).

The new-look campaign -- including Nortel's first TV advertising since 2001 -- is led by chief marketing officer Clent Richardson, who joined the company from T-Mobile (UK) in April 2004 and took his current role last month (see Nortel Appoints CMO).

The campaign comes with a slogan, "This is the way. This is Nortel." Presumably, the slogan doesn't refer to "the way" Nortel has had to restate its financial results from recent years (see Nortel Restates Delay of Restatement and Nortel Misses Halloween Target).

Nortel also might be trying to remove one layer of uncertainty for investors. When Nortel most recently delayed its earnings restatement (the new target is mid-November), analyst Steve Kamman of CIBC World Markets wrote, "With this delay, we are further convinced that most investors will likely take a wait-and-see approach until they see audited numbers and a clear, detailed strategic plan..."

"This is probably more for the investment community," says Sam Greenholtz, analyst with Telecom Pragmatics Inc. "Nortel is still in a tough spot. They haven't been able to get out of it the way they'd hoped."

Nortel isn't the only noteworthy name undergoing a marketing makeover. Ciena Corp. (Nasdaq: CIEN) recently unveiled its new look, which includes a puffy new logo (see Ciena Debuts New Look, New Message).

The goals are similar. Ciena is trying to exhibit its breadth of products beyond the company's optical-transport origins. Nortel is going the business route, putting on display its most high-pressure assignments, such as the network backbones of several stock exchanges. The idea, according to the company's literature, is for Nortel to stop talking about "the network" and instead focus on what people do with the network.

One key difference, Greenholtz noted, is that Ciena is trying to redefine itself completely, while Nortel is simply publicizing the things it's been doing for the last several years. "Nortel has a much more positive trend here than Ciena," he says.

— Craig Matsumoto, Senior Editor, Light Reading

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