Nortel: shunning direct cost us deals

A senior Nortel executive has admitted that the company's past reluctance to market directly to large businesses has cost it enterprise share.

"We lost a number of major customers because of our reluctance to engage directly," Malcolm Collins, president of the enterprise networks division at Nortel Networks, said during a brief visit to Australia.

Collins, who heads up all of Nortel's enterprise activity following a recent streamlining of the company into service provider and enterprise channels, calculates that Nortel is probably second overall in the market behind Cisco, which dominates the sector on every analyst's reckoning.

Collins has no immediate ambition to topple Cisco from that position. "We believe we can double or triple market share," he said. "The marketplace is screaming for a choice."

A key element in that push is a shift away from a purely partner centric model. Around 60 per cent of Nortel staff are now in customer facing roles.

"Right across the globe, Nortel is taking a much more proactive view of direct touch," Collins said, though he was quick to add that this would "not to the detriment of our partners".

More than 95 per cent of business continued to be realised through partners even if the deal was brokered directly, he said.

"A lot of major vendors want to deal with the vendor but are happy for the implementation to be done by the channel," said Nick Avakian, ANZ general manager for enterprise networks.

"It was a big concern to our partners, but they've seen that we've done it in an honourable way," Collins said. Nortel's biggest local rollout partner is 3D Networks, and Commander is also a major player.