AllThingsD » Alcatel-Lucent

Back in Its Skinny Jeans, Cisco Systems Looks for Fat Profits

Arik Hesseldahl — Wed, 09 May 2012 15:25:41 +0000

Networking giant Cisco systems will report quarterly earnings today after the markets close in New York, and the pressure will be on CEO John Chambers to show that the changes made as a result of the companywide restructuring he led last year — the one that made Cisco look like it was fitting back in its skinny jeans — are taking permanent hold. The question is whether or not it can start delivering some fatter profits.

The consensus of Wall Street analysts has Cisco reporting $11.6 billion in sales, and 47 cents per share of earnings.

The big question, writes analyst Sanjiv Wadhwani of Stifel Nicolaus in a note to clients on May 7, will be around margins. Last quarter, Cisco gave guidance for gross margins — a key measure of profitability — with a narrow range of 61.5 percent to 62 percent, while operating margins were guided to the range of 27 percent to 28 percent. Wadhwani thinks that guidance may stand up as pressure on Cisco’s supply chain from the Thailand flooding, favorable pricing on switching products, and a less-aggressive posture from Hewlett-Packard’s networking arm are all providing a little breeze at Cisco’s back.

Yet one product in Cisco’s stable may, in success, be hurting margins overall: Cisco’s Unified Computing and Servers line (UCS) tends to carry a lower gross margin, Wadhwani writes, and so may eat into its overall gross margin. The product line — which combines computing, storage and networking into a single product offered to corporate and service-provider data centers — had 10,000 customers worldwide last quarter, and was showing “positive momentum” in Wadhwani’s checks. “Overall, we believe that there is intense focus on margins internally, which should allow the company to report an in line margin quarter,” Wadhwani wrote.

Cisco has been operating “with more confidence and aggressiveness with its refreshed product line, making it tougher for competitors,” writes Shaw Wu of Sterne Agee in a note to clients issued May 7, and has been a lot of the reason that Juniper and Alcatel-Lucent have missed expectations recently. He expects Cisco to give guidance for the quarter ending in July that’s more or less in line with consensus expectations. He also sees Cisco benefiting from Apple’s next iPhone: “We believe this could mark the fourth quarter in a row where Cisco does not guide down expectations further building investor confidence. We see Cisco benefiting in the second half of 2012 from the continued build-out of 4G LTE wireless infrastructure ahead of the iPhone 5 refresh likely in the September-October time frame.”

I’ll be covering Cisco’s earnings announcement later today. Having dedicated songs to CEO John Chambers two quarters in a row now, I’m going to have to scramble to see what song fits today’s results, because I just know he’s going to ask.

Social Networking Users Say They Want More Control Over Their Info

Liz Gannes — Wed, 30 Nov 2011 11:00:40 +0000

Online privacy is not just for wonks any more. Lots of people say it’s important to them — especially when researchers come asking.

Not everyone is turned off by complex privacy settings, or so they say. Sixty-one percent of social networking users interviewed by Harris Interactive said they’d share more if they could control who could see what they share.

And a significant portion — 20 percent — said they currently opt to share all their photos by email instead of on social networks because they’re worried about privacy.

That study was paid for by the privacy-focused social network and blogging tool Posterous and included about 2,000 respondents. It’s timely, given Facebook just agreed to 20 years of privacy audits.

Meanwhile, an Alcatel-Lucent-sponsored study of about 5,000 Americans found that 70 percent of respondents had ignored friend requests in order to limit who could see their online posts.

That “Identity Shift” study broke out particular age groups. For instance, 85 percent of “empty nesters” and retirees said they’re comfortable sharing information if they have control over who sees it. Among teenagers surveyed, 58 percent said they’d posted statuses, comments or photos about themselves or their families that they later regretted.

The Alcatel-Lucent study found 75 percent of people said they interact with people online that they’ve never met.

Meanwhile, participants in the Posterous study said they’d only met 55 percent of their Facebook friends in person.

Image via Shutterstock/Péter Gudella.

Alcatel-Lucent Considers Sale of Telecom-Gear Unit

Arik Hesseldahl — Thu, 14 Apr 2011 13:20:32 +0000

Alcatel-Lucent is exploring the sale of its business unit that sells phones and other telecom gear to corporations, which could be worth $1.5 billion or more, people familiar with the matter tell The Wall Street Journal.

The Franco-American company has hired advisers and in recent days began to examine options for the business, which has about $1.5 billion in annual sales. Besides a sale to a single buyer, other options include an initial public offering. The range of possible buyers for the business could include tech companies like Microsoft Corp. or Hewlett-Packard Co., or other telecom-gear makers like Ericsson and private-equity firms. Valuations of the business vary, but one person said it’s worth well over $1 billion and possibly more than $2 billion.

Besides office telephones, Alcatel-Lucent’s enterprise business sells switches and other networking gear, plus hardware and software used in the call centers. The business is growing and profitable, one person said, but it accounts for less than 10% of the company’s annual revenue, which last year was $21.5 billion.

Meg Whitman, Patricia Russo Among Five Joining HP Board

Arik Hesseldahl — Thu, 20 Jan 2011 21:16:15 +0000

Former EBay CEO Meg Whitman, and former Alcatel-Lucent CEO Patricia Russo were among five new directors named to the board of directors at Hewlett-Packard.

The other three at Shumeet Banerji, CEO of Booz and Co, Shumeet Banerji former CIO at General Electric and Dominique Senequier CEO of AXA Private Equity.

Four sitting directors Joel Hyatt, John Joyce, Robert Ryan and Lucille Salhany will not stand for re-election, at the next company shareholder meeting in March, the company said.

The move is by far the most sweeping change to hit HP since Léo Apotheker, took over the reins as CEO last year following the departure of Mark Hurd following a allegations of sexual harassment against Hurd by Jodie Fisher, a onetime HP contractor.

Once the latest shake-up is complete, HP’s board will have undergone a nearly complete makeover in recent years. None of the continuing board members will pre-date the Compaq acquisition, with Lawrence Babbio, Jr. the former Verizon President as the longest standing board member having joined at the completion of the HP-Compaq deal. Babbio was a member of Compaq’s board before the merger. All of the others have joined since 2005.

During the last decade HP’s board has been rocked by more than a few scandals, one involving a scheme to spy on journalists in an effort to ferret out the source of a persistent leak. More recently the board has been facing questions about its judgment, first for seeking Hurd’s resignation following the revelation of the sexual harassment complaint, and then for allowing him to leave with more some $53 million in compensation as he went on to become a president HP rival Oracle. HP is facing lawsuits in Delaware and California from shareholders over the incident, and was reported yesterday to be planning a new independent investigation into the circumstances leading up to Hurd’s departure.

Shares of HP shot upward when word of the shakeup first began to leak. The shares rose during the last 20 minutes of trading, closing up 46 cents or nearly 1 percent $46.78 a share.

HP’s statement is below.

HP Announces Changes to Board of Directors

Five highly accomplished business leaders to be added to board
PALO ALTO, Calif., Jan. 20, 2011

HP today announced that its board of directors has appointed five new members, effective Jan. 21. The appointments bring the total number of board members to 17 until HP’s next Annual Meeting of Stockholders in March, at which time the size of the board is expected to be reduced to 13 members.

The new directors are Shumeet Banerji, chief executive officer of Booz & Company; Gary Reiner, former chief information officer of General Electric Company and a current special advisor to private equity firm General Atlantic; Patricia Russo, former chief executive officer of Alcatel-Lucent; Dominique Senequier, chief executive officer of AXA Private Equity; and Meg Whitman, former president and chief executive officer of eBay Inc. The five new directors also will stand for re-election at HP’s next Annual Meeting of Stockholders in March.

In addition, HP announced that incumbent directors Joel Hyatt, John Joyce, Robert Ryan and Lucille Salhany are not standing for re-election at the company’s Annual Meeting of Stockholders.

“The addition of these new directors will further diversify the outstanding talents and wide-ranging experience that our directors already bring to HP,” said Raymond J. Lane, non-executive chairman of the board of directors, HP. “Each is a widely respected and deeply experienced business leader, and together they will provide our board and management team with new insight and perspectives relating to HP’s business and the rapidly changing technology industry.”

Lane discussed the new directors’ backgrounds: “Shumeet Banerji is a respected strategic adviser and will bring to the HP board international, financial, operational and management experience and a true understanding of the issues facing companies and governments in both mature and emerging markets around the world. Gary Reiner will be an important voice of the customer on our board, thanks to his deep insight into how IT can help global companies succeed and his decades of experience driving corporate strategy, information technology and best practices across complex organizations.

“Pat Russo is an experienced executive with extensive global business experience, a broad understanding of the tech industry, and strong management, operations and governance skills. Dominique Senequier is a highly regarded and influential financier who brings broad international perspective, strong financial acumen and a keen focus on long-term performance. Meg Whitman is a true visionary and thought leader who brings to the HP board unique experience in developing transformative business models, building global brands and driving sustained growth and expansion.”

“I am confident that HP’s stockholders, customers and employees will benefit from all of their talents and ideas, and I look forward to working closely with the entire board and management team as we pursue the exciting opportunities in front of us,” Lane concluded.

About Shumeet Banerji

Shumeet Banerji, 51, is chief executive officer of Booz & Company, a global management consulting firm. Most recently, he has focused on counseling government ministries and financial services institutions on the impact of changing demographics around the globe. Banerji joined Booz Allen Hamilton in 1993 and has served clients in both the public and private sector. Earlier in his career, he was a member of the faculty at the University of Chicago Graduate School of Business.

Banerji, who is based in London, earned a Ph.D. from the Kellogg Graduate School of Management at Northwestern University and a B.A. and MBA from Delhi University.

About Gary Reiner

Gary Reiner, 56, serves as a special advisor to private equity firm General Atlantic, providing strategic counsel to the firm and the companies it partners with worldwide. During his career at GE, he served as senior vice president and chief information officer, head of GE Information Services, and as vice president, Corporate Business Development. Reiner’s responsibilities included overseeing IT, operations, sourcing, mergers and acquisitions and quality for the company’s global operations, including GE’s renowned Six Sigma quality initiative. Earlier in his career, Reiner was a partner at Boston Consulting Group, where he focused on strategic and process issues for high-technology businesses.

Reiner earned a B.A. in economics from Harvard and an MBA from Harvard Business School.

About Patricia Russo

Patricia Russo, 58, is the former chief executive officer of Alcatel-Lucent, a global communication solutions provider. She also previously served as chairman and CEO of Lucent Technologies, president of Eastman Kodak and chairman of Avaya, which was spun off from Lucent. Earlier in her career, she held management positions at AT&T and IBM. Currently, Russo serves on the board of directors of General Motors, Merck & Co. and ALCOA, Inc.

Russo earned a B.A. in history from Georgetown University and completed Harvard Business School’s Advanced Management Program.

About Dominique Senequier

Dominique Senequier, 57, is chief executive officer of AXA Private Equity. She joined AXA Investment Managers in 1996 and founded the subsidiary AXA Private Equity that same year. Senequier is a member of the Institut des Actuaries Français (French Actuarial Institute) and a non-voting member of the supervisory board of Schneider Electric SA. Prior to joining AXA Investment Managers, she created and developed the subsidiary “GAN Participations” at GAN, an insurance firm.

Senequier is a graduate of École Polytechnique and holds a DEA (post-graduate degree) in banking and monetary economics from the University of Sorbonne, Paris.

About Meg Whitman

Meg Whitman, 54, is best known for her 10-year tenure as president and CEO of eBay Inc., a global ecommerce and payments company. She ran the company from 1998 to 2008. Prior to working for eBay, she held management positions at Bain & Company, the Stride Rite Corporation, the Walt Disney Company, Procter & Gamble Co., FTD and Hasbro. She also is a former board member of the eBay Foundation, Procter & Gamble and DreamWorks SKG, having resigned in 2009 in preparation for her California gubernatorial bid. Whitman became the third woman in a 20-year period to run for the office and won the Republican primary in 2010.

Whitman was born on Long Island, N.Y. She earned her bachelor’s degree in economics from Princeton University in 1977. She received an MBA from Harvard Business School in 1979.

Four directors are not standing for re-election

“Joel Hyatt, John Joyce, Bob Ryan and Lucille Salhany have offered invaluable service to HP over many years, and we are deeply grateful for their insights, counsel and commitment to HP’s business,” said Lane. “These directors worked tirelessly and effectively to navigate HP through a difficult leadership change in the last six months.

“As a recent addition to HP’s board, I have been incredibly impressed by Joel, John, Bob and Lucille’s experience and talents. I know the entire board of directors joins me in thanking each of these directors for their many contributions towards the long-term success of HP.”

Ryan, the former lead independent director of the board, said, “It has been a great privilege to serve on the HP board and see this outstanding company build on its legacy as a technology leader and innovator. HP is well-positioned to drive – and profit from – the changes under way across the technology industry, and I am confident that, with Léo as CEO and Ray as chairman, HP has a strong leadership team in place to continue moving the company forward.”

The board plans to nominate the following current directors to stand for re-election at the Annual Meeting of Stockholders:

Raymond J. Lane

Non-executive Chairman of the HP board and Managing Partner of Kleiner Perkins Caufield & Byers

Marc L. Andreessen

Co-founder and a general partner of Andreessen Horowitz

Léo Apotheker

HP President and Chief Executive Officer

Lawrence T. Babbio, Jr.

Senior Advisor to Warburg Pincus and former Vice Chairman and President of Verizon Communications

Sari M. Baldauf

Former Executive Vice President and General Manager of the Networks business group of Nokia Corporation

Rajiv L. Gupta

Senior Advisor to New Mountain Capital, LLC, and former Chairman and Chief Executive Officer of Rohm and Haas

John H. Hammergren

President, Chairman and CEO of McKesson Corporation

G. Kennedy Thompson

Executive Advisor to Aquiline Capital Partners LLC and former President and Chief Executive Officer of Wachovia Corporation

AT&T: No, We're Not Capping iPhone 4 Upload Speeds

John Paczkowski — Wed, 07 Jul 2010 16:15:07 +0000

Is AT&T capping data uploads on Apple’s (AAPL) iPhone 4? Not on purpose. Turns out a software issue is responsible for reports of dramatic drops in data upload speeds in some regions of the country, including New York and Philadelphia. AT&T (T) tells me that a software defect in some of Alcatel-Lucent’s equipment has been crippling 3G HSUPA performance in the markets in which it has been deployed. The good news is Alcatel-Lucent is working on a fix. The bad news is AT&T doesn’t yet have an ETA for its delivery.

Here’s the company’s statement on the issue:

AT&T and Alcatel-Lucent jointly identified a software defect–triggered under certain conditions–that impacted uplink performance for Laptop Connect and smartphone customers using 3G HSUPA-capable
wireless devices in markets with Alcatel-Lucent equipment. This impacts less than two percent of our wireless customer base. While Alcatel-Lucent develops the appropriate software fix, we are providing normal 3G uplink speeds and consistent performance for affected customers with HSUPA-capable devices.

Huawei's Brave New World

Yun-Hee Kim — Thu, 10 Jun 2010 12:00:12 +0000

Many people outside of China haven’t heard of Huawei Technologies. But the Chinese telecom equipment vendor has been gaining on its European and U.S. rivals, including Ericsson (ERIC), Nokia Siemens (NOK) and Alcatel-Lucent (ALU), with its pricing advantage as well as its technology.

Last year, Huawei posted net profit of $2.7 billion on sales of $21.8 billion. Dow Jones spoke with Kevin Zhang, vice president of global marketing, about the company’s strategy in the handset space and the telecom-equipment market outlook. The following is an edited version of the interview.

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Alcatel-Lucent Swoons on Cautious 2010 Outlook

Eric Savitz — Thu, 11 Feb 2010 16:40:06 +0000

The troubles continue for Alcatel-Lucent (ALU).

The telecom equipment company’s shares are down sharply this morning after it reported Q4 results and trimmed its 2010 outlook.

For Q4, the company posted an adjusted operating profit for the quarter of 271 million Euros, about in line with Street estimates, Marketwatch notes. But revenue of 3.9 billion euros fell 20 percent, as carrier spending sagged and the company lost market share. The company also turned more cautious on 2010, asserting that while the sector should recover, it is too early to have a firm view on potential margin expansion. ALU now sees adjusted operating margin for the year of one-five percent; old guidance was for five percent.

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Don't Tell a Soul! Media, Tech Moguls Take Manhattan for Semisecret Quadrangle Conference.

Peter Kafka — Tue, 03 Nov 2009 11:00:37 +0000

Wouldn’t you like to bump elbows with media moguls and hear from the likes of Google (GOOG) CEO Eric Schmidt, Twitter co-founder Biz Stone and News Corp. (NWS) scion James Murdoch? Me too!

Alas, the Foursquare conference, hosted by the Quadrangle PE fund, is an invitation-only affair. And the event, which kicks off tomorrow, is closed to the press except for reporters onstage to interview the stars. And those conversations don’t get released to the public.

That’s a particular bummer this time. Because the Quadrangle guys–who have had a rough year–had the foresight to get a lineup that includes GE (GE) CEO Jeff Immelt, who appears to be in the final stages of selling NBC Universal to Comcast (CMCSA) CEO Brian Roberts, who will also be onstage. Sure would be nice to hear what they say.

Another panel that piques my interest, if only because of the title: “Are Popularity and Profitability Correlated?” It features Twitter’s Stone, LinkedIn founder Reid Hoffman and YouTube co-founder Chad Hurley. And would-be moguls are represented by a start-up pitch panel that includes Dennis Crowley of Foursquare, the superbuzzy mobile service whose name has nothing to do with Quadrangle’s conference.

So once again, here’s the complete list of those you won’t be hearing from this week as they gather at the Plaza in Manhattan. Unless, perhaps, one of my more ambitious colleagues sneaks in–I’m thinking of you, Bobby MacMillan–and gets us a first-hand account.

2009 SPEAKERS
EMILIO AZCÁRRAGA President, Board of Directors and CEO, Grupo Televisa
DENNIS CROWLEY Co-Founder, foursquare
BARRY DILLER Chairman and CEO, IAC; Chairman, Expedia, Inc. and Ticketmaster Entertainment, Inc.
BRIAN DUNN CEO, Best Buy
CHARLES FORMAN Founder, OMGPOP
REED HASTINGS Founder, Chairman and CEO, Netflix
REID HOFFMAN Executive Chairman and Founder, LinkedIn Corporation
CHAD HURLEY CEO and Co-Founder, YouTube
JEFF IMMELT Chairman and CEO, GE
PAUL JACOBS Chairman and CEO, Qualcomm Incorporated
OLLI-PEKKA KALLASVUO President and CEO, Nokia
JASON KILAR CEO, Hulu
LESLIE MOONVES President and CEO, CBS Corporation
ANNE MULCAHY Chairman, Xerox Corporation
JAMES MURDOCH Chairman and Chief Executive, Europe & Asia, News Corporation
BRIAN PHILLIPS CEO and Co-Founder, Thread
DAN PORTER CEO, OMGPOP
BRIAN ROBERTS Chairman and CEO, Comcast Corporation
PAUL SAGAN President and CEO, Akamai
ERIC SCHMIDT Chairman and CEO, Google
IVAN SEIDENBERG Chairman and CEO, Verizon Communications
BIZ STONE Co-Founder, Twitter
HOWARD STRINGER Chairman, CEO and President, Sony Corporation
BEN VERWAAYEN CEO, Alcatel-Lucent
DAVID ZASLAV President and CEO, Discovery Communications

MODERATORS
MARC ANDREESSEN General Partner, Andreessen Horowitz
KEN AULETTA Author and Writer, “Annals of Communications”, The New Yorker
MARIA BARTIROMO Anchor, Closing Bell; Host & Managing Editor, Wall Street Journal Report, CNBC
JAMES CITRIN Co-Leader, Board & CEO Practice, North America, Spencer Stuart
DAVID FABER Anchor, Reporter, CNBC
MICHAEL HUBER Co-President and Managing Principal, Quadrangle Group
BECKY QUICK Co-Anchor, Squawk Box, CNBC
GEOFFREY SANDS Director & Leader, Global Media, Entertainment & Information Practice, McKinsey & Co.
JOSHUA L. STEINER Co-President and Managing Principal, Quadrangle Group
GEORGE STEPHANOPOULOS Anchor, This Week; Chief Washington Correspondent, ABC News

Appeals Court Throws Out $358 Million Verdict Against Microsoft

Brent Kendall — Fri, 11 Sep 2009 18:36:01 +0000

A federal appeals court Friday affirmed a jury verdict that Microsoft Corp.’s (MSFT) Outlook software and two other products infringed an Alcatel-Lucent (ALU) patent, but ruled that a $358 million damages award against the software giant was not supported by evidence and needed to be re-calculated.

The case largely centered on Lucent’s claim that Microsoft Outlook’s calendar function infringed one of its patents. Microsoft argued that the patent was invalid and not infringed, but it also attacked the jury’s damages award as far too high.

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Microsoft : Happy Cinco de Fire-o

John Paczkowski — Tue, 05 May 2009 20:18:52 +0000

[ See post to watch video ]

Alcatel-Lucent: Our Earnings Stink in French and English

John Paczkowski — Tue, 05 May 2009 13:29:27 +0000

The econalypse is eroding demand for telecommunications equipment. Operators are cutting spending for network upgrades. Market conditions are tough, but we are taking appropriate actions. It’s a story we’ve heard before, from Ericsson (ERIC), Nortel (NT) and Cisco (CSCO). This morning we heard it from Alcatel-Lucent (ALU). The French-American telecommunications maker said today that its first-quarter net loss more than doubled from a year ago amid a souring economy that’s got its customers slashing capital expenses to preserve cash. With sales down 6.9 percent, Alcatel lost $563.6 million in the quarter, more than twice last year’s $241.7 million loss.

Ugly, even more so considering this is the company’s ninth consecutive quarterly loss since it was created in 2006.

“While expected, given seasonality and tough market conditions, we are not pleased with the operating loss incurred in the first quarter,” said CEO Ben Verwaayen. “Our guidance for the year remains unchanged and we are taking appropriate actions….There’s lots of work we still need to do.”

Report: Nortel Mulling $1 Billion Offers for Various Assets

Tiernan Ray — Tue, 23 Dec 2008 20:00:04 +0000

Nortel Networks (NT) the once multibillion-dollar telecom vendor now trading as a micro cap, may be considering offers of as much as $1 billion for its product portfolio of gear that lets phone companies string Ethernet networking to homes and businesses, according to a report in the Toronto Globe & Mail. Avian Securities’ analyst Avi Cohen argues the most likely bidders are Ericsson, Huawei, Nokia’s (NOK) Nokia Siemens, and Cisco Systems (CSCO), with Alcatel Lucent (ALU) and Motorola (MOT), less likely because of their own titanic problems.

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Happy Holidays from Fairchild and Alcatel-Lucent

John Paczkowski — Fri, 12 Dec 2008 19:00:39 +0000

[ See post to watch video ]

Alcatel-Lucent: Let's Get Small

John Paczkowski — Fri, 12 Dec 2008 16:50:56 +0000

Alcatel-Lucent, the world’s largest maker of telecommunications equipment, won’t be quite so large come 2009. This morning the struggling Franco-American network supplier said it plans to sack 1,000 managers and 5,000 contractors in a bid to bring down costs. “The new management team is committed to rapidly executing this new strategy and leveraging the new streamlined organization,” CEO Ben Verwaayen said in a statement. We are focused on delivering results and restoring profitability.”

This latest swing of the ax brings total job cuts at Alcatel-Lucent (ALU) to about 22,500 since the 2006 merger that created it. And though the company will be leaner and meaner for it, that new found agility won’t count for much without a shift in business strategy bold enough to reverse the brutal reduction in market share and market capitalization Alcatel-Lucent has suffered. And an oblique and, frankly, baffling mention of Web 2.0, does not a business strategy make.

Alcatel-Lucent’s plan is to “combine the trusted capabilities of the network environment with the creative communications services of the Web (Web 2.0, Web 3.0 and beyond).” What the hell does that mean?

Alcatel-Lucent: Let's Get Small

John Paczkowski — Fri, 12 Dec 2008 16:50:56 +0000

Alcatel-Lucent: Report Former COO Quigley to Be CEO

Eric Savitz — Tue, 26 Aug 2008 18:46:19 +0000

Moving quickly to find a replacement for recently departed CEO Pat Russo, the nominating committee at Alcatel-Lucent (ALU) plans to propose former COO Mike Quigley as the company’s new chief executive, according to the French weekly Canard Enchaine, Reuters reports.

Quigley, who had once been considered a likely successor to former chairman Serge Tchuruk, had left the company in 2007 for personal reasons.

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Alcatel-Lucent: We Suck in French and English

John Paczkowski — Tue, 29 Jul 2008 16:37:13 +0000

Alcatel-Lucent is cleaning house and, frankly, it’s about time. After posting yet another massive quarterly loss Tuesday ($1.7 billion), the company said its chief executive, Patricia Russo, and chairman, Serge Tchuruk, who together led its trans-Atlantic merger two years ago, will resign their positions by year end.

“The merger phase is now behind us,” Tchuruk said in a statement. “I am proud that Alcatel-Lucent (ALU) has become a world leader in a technology which is transforming our society.”

Added Russo, “Our strategy is taking hold, and our results are demonstrating good operational progress. That said, I believe it is the right time for me to step down.”

Apparently, after six consecutive quarters of losses and a brutal reduction in both market share and market capitalization, their work is done.

Alcatel-Lucent Lawsuits a Lot Like Alcatel-Lucent Earnings

John Paczkowski — Tue, 07 Aug 2007 18:00:02 +0000

[ See post to watch video ]

That Extra $1.5 Billion Will Just About Cover the Cost of Those Xbox 360 Repairs

John Paczkowski — Tue, 07 Aug 2007 17:21:02 +0000

Alcatel-Lucent’s astonishing $1.52 billion jury verdict against Microsoft would have done much to bolster the company’s sagging fortunes. But the Franco-American telecommunications equipment maker is going to have to look elsewhere for financial solace.

Finding that a jury’s decision was “against the clear weight of the evidence,” a federal judge yesterday overturned the February verdict that found Microsoft to have infringed upon two of Alcatel-Lucent’s digital music patents. The judge ruled that it doesn’t hold the rights to one disputed patent and hadn’t proved that Microsoft’s programs were using the technology in the other.

The decision is quite a win for Microsoft, which licensed the technology at issue in the case from its rightful licenser–German firm Fraunhofer–and was understandably a bit incredulous when Alcatel-Lucent sued it and won. “Today’s ruling by the judge reversing the jury’s $1.52 billion verdict against Microsoft is a victory for consumers of digital music and a triumph for common sense in the patent system,” Microsoft said in a statement. “For the hundreds of companies large and small that rely on MP3 technology, the Court’s ruling clarifies that these companies have properly licensed the technology embodied in the ’080 patent from its co-owner and industry recognized MP3 licenser–Fraunhofer.”

For Alcatel-Lucent, of course, it’s a different story entirely. It’s lost not just the $1.52 billion jury verdict, but the supplemental damages and prejudgment and postjudgment interest it was suing Microsoft for as well. “The reversal of the judge’s own pretrial and posttrial rulings is shocking and disturbing,” said Alcatel-Lucent spokeswoman Mary Ward, who noted the company plans to appeal. “The jury unanimously agreed with us. We believe their decision should stand.”