Nortel’s Dunn: Big vendor mergers not in the cards

BOSTON—Yesterday’s announcement of a merger between AT&T Wireless and Cingular Wireless likely won’t lead to a wave of acquisition among equipment vendors, according to Frank Dunn, CEO of Nortel Networks. At the same time, he anticipates there to be fewer vendors competing in the next 12 to 18 months.

Speaking at the company’s annual investor conference here, Dunn said that if there is consolidation, Nortel likely wouldn’t be leading it. In the telecom boom of the late 90s, the company was one of the more prodigious acquirers, sweeping up numerous optical component vendors.

In the emerging telecom environment, though, being everything to every carrier is impossible, and doesn’t yield the kind of efficiencies everyone anticipated, Dunn said.

“Any company that tries to do many, many things will do many things poorly,” he said.

Instead, Nortel will focus more on partnerships. Yesterday, for instance, the company announced an agreement with Calix under which it will market and sell Calix’s access gear.

“To be really good at something and team with another company that’s really good at something is a model I’m a big believer in,” Dunn said. “We’re going to stay our course and work with partnerships.”