| BUSINESSWEEK ONLINE : NOVEMBER 6, 2000 ISSUE | ||||||||
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| INFORMATION TECHNOLOGY
Can This Business Be Saved Lucent's problem areas OPTICAL NETWORKING PROBLEM Lucent blew it with its 1997 decision to design new switches for capacity rather than speed. Nortel went the other way and now has 43% of the $6 billion world market vs. Lucent's 15%. SOLUTION Lucent could win back customers with its state-of-the-art LambdaRouter optical switch. Its micro-mirrors tilt to steer light--but the market may not be there yet. CIRCUIT SWITCHING PROBLEM Lucent may be king in this market, but demand is slowing for traditional voice switches. Plus, Lucent's habit of lending to its own customers has resulted in a lot of bad debt from emerging phone companies. SOLUTION Lucent wants to deemphasize voice switches and rein in lines of credit. DATA NETWORKING PROBLEM The company is way behind in high-speed Internet routers, the fastest-growing segment of this market. Cisco and Juniper are nabbing all the action. SOLUTION New routers from recent acquistions may help it get into the game. And it's still the leader in selling data equipment to communications carriers--albeit older technology. CORPORATE CULTURE PROBLEM Despite all the talk of its liberation in the spin-off from AT&T, the bureaucratic legacy survives. The result: a crippling brain drain and a loss of confidence among customers and investors. SOLUTION Lucent is streamlining internal operations. And there's still the vaunted Bell Labs, whose innovations must be put to better use. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP |
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RELATED ITEMS Telecom Turmoil Cisco: Navigating Choppy Water CHART: Cisco's Slide TABLE: Where the Trouble Is AT&T: Breaking Up Is Still Hard to Do TABLE: Hold the Phone ONLINE EXTRA: Q&A with AT&T CEO Mike Armstrong Lucent: Clean Break, Clean Slate? TABLE: Can This Business Be Saved ``We Tried to Run Faster Than We Were Capable of'' (extended) INTERACT E-Mail to Business Week Online | |||
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