Just as telecommunications, data communications technology and vendors are merging, so too will the respective channels, Nortel president David House predicted last week during a brief visit to Australia.
He claimed that there had to be mergers and acquisitions between those with expertise in selling and servicing voice equipment and those with expertise in selling and servicing data equipment.
"You're going to see a dramatic change," he said. "As voice and data networks become unified, the channels will also become unified."
Right now, there is some conflict, as each wants access to the other's product range, yet wants to stop the other side from selling its products.
"Some of them are going to be able to make the transition, and others won't," House said.
Despite Nortel's history of direct selling, the company had no intention of changing the way that Bay sold networking equipment through the channel, House added. It would continue to send all sales through resellers and integrators.
House was naturally upbeat on the future of the merged communications giant, claiming that it had stolen a leap on competitors Cisco and Lucent. Lucent would struggle to find a data networking acquisition that would enable it to compete on level terms in the enterprise market with Nortel and Cisco. Meanwhile, Cisco needs to make another telecommunications acquisition, he said.
"We've gone from being a third of the size of Cisco, to being double their size," he said.
Change management program
House admitted that "large mergers are always difficult", but said Nortel CEO John Roth had been implementing a change management program inside his company for the last year.
He said Nortel sales staff and engineers were very receptive to ideas from the Bay camp and that there had been "an instant chemistry" between the two organisations.
Most important, though, was that customers had been very supportive of the merger.
"Ninety days into this merger, we are yet to find a customer who is not happy," House said.