Nortel to Clarify e-business position

Nortel Networks has launched its Clarify eBusiness Applications Unit, part of its drive to move up into the higher value level of Internet business.

Nortel's partners in this venture include systems integrators such as Anderson Consulting. High-end customer relationship management (CRM) software such as Clarify is not something that will initially involve its resellers.

Peter George, European president of enterprise solutions at Nortel, said: "We have to upscale our channel to learn CRM. This is an opportunity for our partners to move up the value chain, away from boxes, and into a business where customers pay a premium."

Nortel achieved a 321 per cent increase in its share price last year, which analysts cite is a necessary growth to finance acquisitions and maintain market leadership.

Rivals Lucent and 3Com have spun off under-performing data networking operations to protect share values. Nortel will not pull out of the enterprise, but maintains it will concentrate on areas of high growth, George said.

Richard Moran, vice-president of business development at Nortel, said: "Rather than investing in pizza-boxes (traditional routers) we're pushing Open IP, disseminating routing intelligence around the network and developing higher level products with value-add."

The vendor will continue to sell traditional data networking products, but as commodities. "Even smaller companies will need sophisticated products to handle broadband Internet access and deliver quality voice over IP," he added.

HOW FIRM AIMS TO BE 'FIRST MOVER'

Nortel hopes its acquisition of CRM vendor Clarify will give it the same 'first-mover' advantage as its 1998 acquisition of Bay Networks, which heralded the convergence of voice and data.

The networking vendor said the second generation of e-commerce will see firms reach out to customers through integrated Web sites, voice recognition and call centres.

But Nortel estimated it will take 18 months until this technology is released in a format applicable to the wider channel.

Richard Moran, vice-president of business development at Nortel, said the quickest way to get this technology to SMEs will be to have it hosted by an application service provider - a route that may cut out resellers.

Its enterprise networking rival, Cisco, claimed that Nortel was repeating the old mistakes of "all-things-to-all-people" vendors such as IBM. But Nortel said it was attacking the market from a position of strength.