American in Paris

“God! Lucent is gone,” Motorola CEO Ed Zander lamented at an investor conference on the eve of the Alcatel/Lucent Technologies merger's consummation. “Those are the [companies] I grew up with.” A slight illness had put Zander in a “reflective mood,” outside of himself, he said (maybe that's why he twice referred to Netopia, his company's recent acquisition, as “Entopia”), but his awestruck observance of this loss is worth repeating.

Lucent's relocation from New Jersey to Paris (opposite poles of the West's cultural axis, surely) siphons away a sizable chunk of telecom spending and power. The world's biggest market for telecom gear, the U.S., now sends its money increasingly elsewhere: Canada, Finland, France, Germany and Sweden. With the East Coast pillar removed, the weight of American wireline telecom equipment authority rests largely on Cisco Systems and — God! — on Ed Zander, who scarcely mentioned the company's wireline business in his speech. Other key U.S. wireline vendors, such as Ciena, Juniper Networks and Tellabs, are frequently marked as takeover targets. That could easily send another of our national telecom assets to, say, China (to quench Huawei Technologies' reputed thirst for U.S. market share). But even if those firms are acquired instead by other Americans (Motorola buying fellow Chicagoan Tellabs is at least conceivable, but not Cisco/Juniper), the number of U.S. telecom suppliers still shrinks.

However, our power to innovate in this space is undulled: We still give rise to Infineras, Matisses and Redbacks. In a more consolidated telecom equipment market, perhaps Americans could be well-known for the innovative start-ups born here and acquired by the giants in the rest of the world. In any case, unless you're now below the legal drinking age, the American contribution to the world's wireline telecom equipment needs won't come from the companies you grew up with.