Funding for startups

NTT Still Keen on Startup Vendors

Has the era of the startup innovator passed in telecom? No, reckons NTT America Inc. 's Michael Wheeler.

NTT Group (NYSE: NTT) is known as one of the largest carriers in the world, and also as an innovator. That heritage means the company is still very much open to trying out new products, whether they're from established or emerging suppliers, says Wheeler, VP of the Global IP Network unit at NTT America, which is part of NTT Communications Corp. (NYSE: NTT), the Japanese giant's international business.

"We are always very interested in up-and-comers," Wheeler says. "We started out with Juniper Networks [whose T-1600 products are in NTT's IP core] when they were a startup. We are always very open to early-stage companies that are in development. Those types of early-stage players are often more accommodating to our needs."

By contrast, more established players want to push customers toward one of their existing platforms, Wheeler says.

And it isn't more time-consuming to deal with startups because vendors whose gear isn't up to snuff are generally pushed out of competition early in the selection process, Wheeler says. It's in later discussions with product teams and during lab trials that a rapport develops between NTT and a potential vendor, and Wheeler believes that can happen between a company as big as NTT and a small vendor.

But there just aren't as many companies today on which to test that theory.

"They aren't very common any more -– [IP router vendor] Procket may be the last one I remember, then Cisco bought them," recalls Wheeler. "We were talking to them early on, and they had some pretty interesting things to talk about." (See Cisco to Pay $89M for Procket Assets, Procket Puffs Tokyo Project and Procket Gets Unstealthy.)

Wheeler says NTT execs, such as NTT America's CTO Doug Junkins, still maintain and value their relationships with innovators in the industry.

"We know this is not a trivial exercise," he says. "Juniper is really the only one that has done it in the last decade."

— Carol Wilson, Chief Editor, Events, Light Reading

spc_markl 12/5/2012 | 5:14:58 PM
re: NTT Still Keen on Startup Vendors


Perhaps the reason that NTT is not seeing as many startups is that it usually fails to lead to anything significant in terms of business with the company.  Do announcements by NTT working with non-incumbent vendors tend to be taken seriously?  Its main goal is to keep up with technology advancements.  The fact that it is in effect asking for more involvement by new suppliers speaks for itself.  In contrast, Verizon does not seem to be lacking products to test in its laboratories.  At least in the case of this US service provider, there is the possibility (albeit rare) that it will encourage its systems integrators to purchase the newcomer.

Mark, Telecom Pragmatics

digits 12/5/2012 | 5:14:58 PM
re: NTT Still Keen on Startup Vendors


You have a point, of course, but I think you also need to take the comments in context. He is talking from a NTT Americas standpoint with IP transport particularly in mind. Hence the Procket reference.

If you compare NTT Group's labs with Verizon's I wonder if you'd see much difference? I would argue that NTT Group is among the leading operators to take technology risks and try new vendors.  


cnwedit 12/5/2012 | 5:14:57 PM
re: NTT Still Keen on Startup Vendors


I don't think Michael Wheeler was necessarily soliciting start-up vendors so much as saying that NTT listens to those that come forward. Maybe the real point here is that there are fewer startups today, for many and diverse reasons, and that those who have potential are quickly snapped up by larger vendors.



opticalwatcher 12/5/2012 | 5:14:48 PM
re: NTT Still Keen on Startup Vendors

Procket with NTT is a good example of the problem startups have. By definition, they have no existing product to receive revenue from while they develop and sell their new product.

While NTT was having 'interesting' discussions with Procket, the company was probably deeply in the red. If these telcos want more innovation in the marketplace, they need to go beyond seemingly endless discussions with them, and be willing to spend some money on some of the more promising prospects.

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