After a five year hiatus, Nortel is re-entering the broadband access market through a joint venture with leading network provider Huawei Technologies.
Nortel's Asia-Pacific director of access technology, Danny Ng, said the world was on the cusp of a second wave of broadband technology.
He said the first wave was typified by common denominator services such as supplying basic Internet access to consumers and residential premises through ADSL.
"The next wave is all about business connectivity," Ng said. "New applications are driving new business trends and unless broadband infrastructure is stepped up, vendors will be left in the cold."
"Being able to distribute multimedia content in any form and ensuring quality of service is key," he said.
Previously, Nortel had been a successful player in the DSLAM market, but had left as sales margins were too low.
"We found that while the business drove a lot of volume it was quickly commoditised by others which drew margins down," said Ng.
Headquartered in Ontario, Canada, the new joint venture will combine Nortel's voice and broadband network products with Huawei's broadband access technologies. This will allow service providers to offer residential and business customers converged voice, data, video and wireless systems on a common IP platform.
"Although this is a global initiative, we will be focusing different aspects of broadband access for different global markets," Ng said.
Nortel had been looking to re-enter the market but did not want to leap in without tried and tested products, he said.
"Huawei are a global leader across all aspects of broadband access, so for us they were the ideal choice," Ng said.
Although the venture is yet to be consummated, the two companies will enter into a supply agreement that will allow Nortel to source and resell specific products from Huawei's broadband access portfolio.
"This transitory step towards the joint venture will allow us to address local market needs straight away," Ng said.
Nortel and Huawei will be the exclusive sales channels for the joint venture's products.
Ng expects the joint venture to be in full operation by July.