The new devices are IP phones , which signifies they run more than an internal packet-switched IP network, as an alternative of a conventional circuit-switched telephone network. Lucent is the former Bell Laboratories, the analysis and development arm of AT&T that has spawned such telecommunications technologies as the T-1 circuit, digital signaling, and the Private Branch Exchange (PBX), upon which the majority of workplace telecommunications environments are presently run. Compared to the year-ago numbers, Lucent now says that revenues will be flat and earnings will really decline 20%.
Lucent is seeing this convergence of voice, data, and Internet eat into its incumbent industry as voice is only one component component of the new generation of networks. To place it merely, Lucent’s management screwed up. They mis-executed on a number of fronts, like manufacturing bugaboos and being out of touch with their customers’ technologies needs. Although there are some significant technological challenges for Lucent to overcome in the future, they had little or no impact on the earnings shortfall. Here’s an instance: If Lucent ships a switch to AT&T, and AT&T promises to spend in 60 days, then that promise represents a receivable from AT&T.
Unless management changes its approaches and gets its financial residence in order, Lucent will continue to endure. However, given the rapid migration toward totally integrated data-capable networks, even with out the monetary problems, Lucent will be challenging-pressed to sustain its preeminence in the business. To top it all off, Lucent has assumed a substantial amount of debt in the wake of a stream of acquisitions (such as that of Ascend Communications). Nowadays Lucent carries more than $four billion in lengthy-term debt, alongside $1.eight billion in cash.
For each investor declaring Lucent dead meat, there is an additional saying that this price drop is a important getting opportunity. If Lucent wants to attract our investment dollars, it will have to get down to the company of cleaning up its balance sheet more than the next 3 quarters. If, rather, the good quality of its balance sheet remains at the identical level or deteriorates, you can count on the stock value to languish, management to get the boot, and Lucent to uncover itself losing ground swiftly to the competition. This current fall from grace was rapid and harsh – but only in terms of stock price tag.
Lucent Technologies: Lucent technologies was a spin off company of AT&T, and Fiorina was placed in charge of Corporate operations. I often had grand intentions to attempt to use my fancy telephone and the blogger app to hold you all updated – but, I can’t figure that app out and I gave up. McGinn was appointed CEO of Lucent in 1997, succeeding Henry Schacht, who had managed the manufacturer’s spinoff and for whom McGinn had worked as COO. The wireless Centrex functions function with either code-division multiple access (CDMA) or time-division a number of access (TDMA) technologies.