In the meantime, I wanted to spend a few minutes discussing something I have been following for 10 years and have even had some involvement with: the Large Hadron Collider at CERN (the world's largest particle physics laboratory).

The LHC, as it is known, is the single largest machine ever built and the biggest scientific experiment ever conducted on the planet. You can read more about the LHC and its objectives here and (assuming you are part or all geek) I think you will find it fascinating. Even if you're entirely non-technical, the LHC, which went live this week, got some significant press as the mainstream media picked up on some views that this experiment – which "was going where nobody has gone before" – could have unintended consequences (such as the end of the planet). Well, obviously we are still here, so things are good so far .

What I wanted to talk about was the information and networking technology underneath this system because it illustrates how important IT capacity and capability are to almost everything we experience today.

Behind the 27 km super-cooled superconductive proton accelerator and its detector experiments is a network and compute infrastructure that, on a global scale, is as ambitious as the core physics experiment taking center stage. The data grid that will gather and process the information the LHC will collect is absolutely huge. Over 100,000 CPUs will be needed to churn the data collected continuously over the 15-year life span of the project. These CPUs are connected in some of the largest data centers in the world using a minimum of one-gig and in many cases 10-gigabit/sec interfaces per node.

Every year the system will generate 15 petabytes of data for analysis (that's 15 million gigabytes if you need a reference). The two tiers of compute will include over 500 institutions around the world and, at any given time, upwards of 5000 scientists will be accessing the data. And, all the data collected from this week until the end of the 15-year project will need to be stored and made accessible to the research community.

For those of you who want to see the real time data behavior of the LHC, if you go to
http://gridview.cern.ch/GRIDVIEW/ you can view the operational status of the data grid and see how much bandwidth the system is generating and how many compute jobs are running. It's interesting if you're an IT person because most corporate IT shops use similar tools to make sure their systems are operating, but for comparison purposes the scale of the LHC makes most (but not all) IT shops look pretty simple. Maybe you can benchmark your internal IT complexity to the LHC and in your next performance review tell your boss (who probably knows what an LHC is thanks to the media this week) that your IT complexity is equal to .7 LHCs .

By the way, the reason I am blogging on this is not just because it's interesting but because in my career one of the most interesting environments I have had the pleasure to work with was the openlab effort at CERN. I had the opportunity to go into the tunnels as they were building this project, to see the raw science and even to give a keynote at the 2004 CHEP (Computing in High Energy and Nuclear Physics) Conference in Interlaken, where CERN celebrated its 50th anniversary. 

I am a bit of an LHC groupie and am personally excited to see this project go live. It will possibly show us two things: first, it may unlock some of the secrets of the universe by simulating moments after the big bang; and, second, it will show us again how IT and networking systems play a huge role in enabling almost everything we do today on this planet.

As a final note, if you don't want to delve into the technical details of some of the links above and below, you can read a pretty good fictional work by Dan Brown called Angels and Demons, where CERN and the LHC play a leading, although fictional, role.

Congratulations to the team at CERN and the openlab for a fantastic milestone!

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Some links you might be interested in:

CERN in 3 minutes video

LHC Rap (A somewhat silly but informative summary of LHC)

LHC Overview (less silly)

New York Times Article

Computer Weekly Article

"I find real value reading your blog, and always learn something, but what really bothers me are some of the comments that people leave, and why we as a company allow that. A lot of comments are valid and they add insight to the discussion, and I think that's a valid and good use of a blog. Gets a dialogue going. What I don't agree with is the fact that we let a handful of people, and they're always the same people, rant about the Nortel stock, our leaders, etc. Why are we providing a public place for these people, most who seem to be disgruntled shareholders or ex-employees? Do we really want a blog that we promote on our homepage to provide a forum for these people who seem to be allowed to say anything they want while hiding behind an alias? Maybe you should consider closing off the comments section. I think we do more harm than good by letting this very vocal minority dominate the dialogue with comments that are completely off topic and add no value."

I've thought about that very topic myself over the last several months, so thought I'd open it up for some discussion.

When I started the blog in January 2007, I think I was pretty clear on its purpose - to provide a forum to discuss the industry, technology, and Nortel's vision and strategy. Some posts have generated some very good discussion and dialogue, and those have been terrific. I always value opinions, even if (or perhaps especially if) they are controversial. I have no issue with comments that question or challenge a direction. We don't all have to agree.

The "off-topic” and, in many cases for me "off limit,” topics (as an officer of the company, the bottom line is that I can't comment in this forum on stock price, financial guidance or potential M&A activity, for example) degrade the quality of the dialogue and distract from what, I think, people come to this blog to read about. No answer that I could provide would address the frustration underlying some of those comments, and because of this people who post what they believe are valid comments expecting a dialogue from me are left wanting. It's a no-win situation. Do we let people continue to use the blog to start these unresolvable dialogues? Do we delete off-topic comments? Do we stop doing the blog completely and I just post a number of white papers?  What are the options?

So, as you can see I'm re-evaluating the blog and I would like your input to help shape its future. I'd particularly like to hear from the silent majority. According to our statistics, more than 10,000 of you read this blog every month, so I'd really like your input on its value. I'd also appreciate some insights from other bloggers in the blogosphere. How do you deal with this?

There are three ways for you to weigh in (choose one or choose them all)...

1. Take the 3-question poll below. Simple and fast. And completely anonymous.
2. Send an e-mail directly to me at: ctooffice@nortel.com
3. Leave a comment in the Comments section of this blog. For those of you who have never left a comment on a blog before, just scroll to the bottom and type your comments into the comment box. The user name you choose to use will be posted, but your e-mail address will not be. You will remain anonymous.

The goal of this reevaluation is not to de-commit from having a public dialogue, but instead to ask the serious questions about what have we learned from the 1.0 version of this blog for the last year and half, and what should the 2.0 version of this blog look like?

Thanks. I look forward to your feedback.

I think we’ve been pretty clear about our strategy. We are transforming Nortel to be a company focused on capitalizing on the trends of Hyperconnectivity. Our key areas of focus are: 1) to accelerate the shift to a true broadband world (where capacity and availability of mobile, low-cost bandwidth is made possible at an order of magnitude improved economics); and 2) to communications-enable the applications and IT world (where the tools and capabilities of telecommunications become accessible to any interface, application or  business process in a simple, well-integrated and seamless manner).  I talked more about this strategy (and positioned it in terms of the “supply” and “demand” side of Hyperconnectivity) in my July 14th post.

Over the last year, we’ve undertaken a host of tactical activities to capture the opportunity articulated by our strategic vision. I won’t list all of the activity here (too many, and much of it was covered during our recent Nortel Analyst Day) but among the most significant: we’ve rebuilt the senior leadership team; we've transformed our business operations to drive a totally different economic equation (the result is our gross margin and operating margin have improved dramatically both in terms of trajectory and absolute values); we've refocused our R&D model to direct more investment to the future (we went from 55% legacy R&D to about 20% and shifted huge R&D spend to future technical areas and investments); we reorganized our global R&D footprint to give us a skills-based R&D model aligned for the future; we established partnerships with the leading IT companies in the world (Microsoft and IBM); and we've made countless other changes that are tactics aimed at making Nortel’s strategic vision real.

I wanted to focus this post on another form of tactics – small, targeted technology acquisitions. Over the past three weeks, we’ve announced three of them. When you have clarity of vision and commitment to a strategy - which Nortel does - tactical acquisitions can accelerate the execution. I want to take a few minutes to talk about our three recent acquisitions.

Novera Optics is a technology company we have been working with for a while that specializes in WDM-PON (wave division multiplexing passive optical networking). Many years ago, Nortel exited most carrier wireline access technology markets (DSL, for example) so we could focus on our core businesses but also because the cost of being in that business and being a profitable player at that time was questionable because of commoditization and too many divergent, short-term technologies.

Unfortunately, the reality of fiber access today has been primarily delivered via shared systems such as EPON, BPON and GPON. Additionally, each is slightly different and the fragmentation of these technologies makes for a very difficult market for those who participate in it because none of the technologies is fully complete nor do any of them achieve true critical mass economics.

At Nortel, given our huge understanding of optical systems in the core, it became clear that the ideal fiber access technology would be a simple WDM system that provided a “wavelength to the user”. Such a technology did not really exist a few years ago but over the past few years we have been working with companies like Novera (via our LG-Nortel JV) to demonstrate and even provide early deployments of WDM-PON technology.

Its advantages are clear. It is dedicated, not shared, capacity; it is far more passive than GPON, EPON or BPON; it scales better; and it has similar or better capital costs than the others with far less operating cost and complexity. After working with Novera to develop this technology and after proving it is in line with a new end state for fiber access, we made the decision that it would be to our competitive advantage to have LG-Nortel acquire the technology. Although WDM-PON is not yet fully mainstream, we have enough traction and interest to confirm that inevitably this technical approach is the long-term path for fiber access. It is also highly complementary to our optical business and, as such, makes sense for Nortel. It also gives us a technology that supports our focus on true broadband because it drives down the cost and complexity of access at an extraordinary rate and makes abundant, simple capacity available to users.

Pingtel's business was acquired by Nortel August 8. First, some disclosure. At one time I was on the advisory board of Pingtel but it’s been many, many years since I’ve been involved with the company. I was “reintroduced” to them when Nortel selected them as a technology provider for some of our small business IP based voice systems. (I excused myself from that decision to avoid perception of conflict of interest.)  

We originally engaged Pingtel to work with us to leverage the open source software base of its product to create a new class of small business voice system. We also worked closely with companies such as IBM and Dell to take advantage of world-class “off the shelf” hardware. This combination of the open source leverage of some of the software and the computer industry’s leverage of general-purpose hardware created a very different class of call server. That initial engagement in creating our Software Communications System 500 was new territory for Nortel but seemed to be in a space that inevitably the industry would need to operate in. After a year of real-world experience and actual delivery, it is now clear that this model does indeed meet a market need and gives us both a speed and cost advantage over our competitors in this segment.

As such, having proof that it works, we made the decision to acquire the expertise behind the technology so that we could accelerate our execution in this segment. With Pingtel’s technology and team, we have created increased scale and differentiation in a very significant emerging segment of call processing and real-time and unified communications delivery to the market. We have always said that the vision of unified communications and communication-enabled applications is not just for the large enterprise or corporate campus but should also be able to reach any enterprise, any individual and any organization. Expanding our capability in the smaller sized customer segment with novel systems like the SCS500 directly supports our strategy.

DiamondWare was acquired by Nortel today. This company is a leader (in my opinion, it is the  leader) in advanced spatial audio systems and associated technologies.

About a year ago we began (or restarted after a multiple-year hiatus) funding incubation programs in Nortel. These startups inside the company are focused on truly disruptive or innovative new areas of collaboration and communications technology. One of those areas, which I blogged about in March, uses mixed and virtual reality as an interface for communications and collaboration. One of the key technologies in that immersive experience is a rich audio capability that not only sounds clearer via wideband codecs but also has spatial reality, where virtual entities can interact based on proximity -  both visually and in the audio domain.

In the development of our systems in this space, we evaluated a number of approaches and ultimately found DiamondWare to have not only the most effective but also the most mature and scalable system, expertise and technology in this domain. We worked closely with them and demonstrated their technology as an element of our overall system. Based on exceptional feedback from early customers and great technical interaction, we concluded that an acquisition made sense to accelerate our move to these new immersive clients and environments for the new communications world. All of their technical expertise and capability – which goes beyond spatial audio – is in line with our vision and strategy of creating better, more realistic and more useful communications and collaborative experiences as communications and IT converge. Again, very consistent with the overall vision of the company.

You might be interested in the announcement we also made today about web.alive – the first application we’re developing that incorporates DiamondWare technology. This is the application behind the virtual employee session I blogged about in March. It is a virtual world software application that can facilitate internal collaboration as well as customer and partner interactions over the web. It leverages things like spatial, high-definitition audio, identity, and presence that is integrated with corporate systems and software to create a truly “real-life” experience in a virtual world. You can hear directly from the chief architect behind web.alive and see a video of the solution here.

In summary, you must use many tactics to execute on a strategic transformation. Some are financial and operating transformations. Some are people transformations and organizational renewal. And some are capturing relevant external technologies to secure and accelerate your ability to reach leadership ahead of your competitors.

Expect us to continue to use every tactic necessary to win and complete our transformation but recognize that everything we do is aligned to a clear vision of the future and the need to get there ahead of our competitors.

It also didn’t take long to understand (through conversations with other business leaders, customers, competitors, and government leaders), however, just how vulnerable this leadership – and industry – is, not only in Canada, but also in the United States and in Western Europe (Siemens’ recent exit from telecom is a good example), and of just how urgent it is that action be taken now to reverse a very disturbing trend that shows that the power base for leadership is shifting.

The single most significant reason why I believe this shift is occurring is because the governments in other countries – particularly those in Asia – have recognized that information and communications technology (ICT) will be the competitive tool for their future so they have made ICT a national priority. They have a clear understanding that the adoption of ICT correlates directly to a country's productivity, which in the simplest of terms will impact the very social and economic fabric of a nation and its standard of living. Increasing productivity in Western nations is particularly critical given current demographics and the aging and pending retirement of large numbers of our workforce.

ICT also represents a key source of innovation (read jobs and higher wages) for years to come, as we work to build out the next generation of communications.

Although Canada and other Western nations are making progress in updating their regulations and legislations, it is not happening fast enough to meet the changing competitive environment. In Canada, for example, the current Telecom Policy dates back fifteen years, to 1993, and in the US to the 1996 Telecom Reform Act.

Consider the environment back then. In 1993, networking was focused on voice; services were aligned to infrastructure ownership; bandwidth was scarce and therefore expensive; customer access to services could be controlled; networks were deployed to offer single applications; product life cycles were long, justifying substantial R&D investments; mobility was a niche market; copper was the primary form of access; telecom influence was primarily within national boundaries; and competition was limited and domestic.

Fast forward to 2008, and we live in a very different world. Also not foreseen in early to mid 90s was the penetration of broadband in such countries as South Korea, China, and Singapore, where telecom policy and regulation are today key planks in national programs of economic development.

At the invitation of the Globe and Mail, one of Canada’s premier national business publications, I put some of my thoughts on this topic into an op-ed piece that ran last week and which I’ve pasted below. This gives my view of the state of telecom in Canada but also of the opportunities in front of us if we act now. By proxy you can extrapolate this to the rest of NA and Western Europe.

The bottom line is that if we fail to recognize the value of our telecom industry and the role that it will play in our future prosperity and if we fail to nurture and cultivate it as a national priority, we risk giving up our historic leadership in this industry and we will lose our ability to control our communications future.

Of all the things in the industry that are challenging (the macro economic climate, the competitive landscape, the technical transformations I’ve talked about in past posts, etc.), I think this one is the most dire. An innovation-oriented industry cannot be taken for granted. It needs to be cultivated. It needs country support and government leadership, hand in hand with industry leadership.

I’d be interested in your thoughts on this topic …

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ICT industry needs help to regain edge
by John Roese

Globe and Mail, August 4, 2008

Not so many years ago, Canada was a global leader in communications, the envy of most of the world. Today, the view of Canada as a leading-edge creator and user of communications technology is gone.

Other countries around the globe – particularly in Europe and Asia – are outpacing Canada in both the creation and deployment of advanced information and communications technologies (ICT) and in offering their citizens the advanced productivity-enhancing applications and services that ICT makes possible.

A recent report from the United Nations' International Telecommunication Union, for example, ranks Canada 15th in broadband penetration. Only five years before, Canada ranked third, closely behind South Korea and Hong Kong. A growing number of other ICT-related indexes also suggest Canada is falling behind. According to the World Economic Forum's 2007 “network readiness index,” which measures the ability of a country to participate in and benefit from ICT developments, Canada ranked 13th, down two spots from the previous year.

All Canadians should be seriously concerned by this downward trend. Why? Because ICT is directly related to a country's productivity and competitiveness – and, hence, its wealth and prosperity. In fact, it is widely acknowledged today that ICT as an enabler of broad economic development has surpassed that of the value of the sector itself. ICT will be the competitive tool for a country's growth for the next several decades.

Does Canada have the capability to regain its historic leadership in communications? I believe so. Do we have the will? I hope so.

The opportunity
There are two reasons why I believe Canada can regain its leadership. One, we are on the threshold of a new era in communications (and new eras always create opportunities for those who move quickly to take advantage of them); and, two, all of the core competencies required to lead in the new era exist in Canada today.

First, the opportunity. We are moving from being a fully connected society to a “hyperconnected” one, where the number of network connections will soon far surpass the number of humans connected to the network. Every computing device and application that could benefit from being connected to the Internet will be connected – cars, home appliances, medical equipment, cameras, industrial machinery, entirely new classes of devices not even dreamed up yet, and even business processes and software applications, themselves.

This unprecedented connectivity is also helping bring together the historically separate worlds of telecom and IT – a convergence that is impacting everything from social behaviour, to business models, to technology investments, to price points and industry structures. By combining communications capabilities with IT applications (what I refer to as “communications-enabled applications”), we have the opportunity to create an almost infinite variety of new and revolutionary services and experiences that will significantly enrich the lives and productivity of individuals, governments, and business of all types and sizes. Think health care, the environment, security, and social services, to name a few.

The core competencies and capabilities required to lead the world in this next generation of communications exists in Canada today. We have world-leading optical, wireless infrastructure, voice and handset technologies; some of the world's best applications companies, operating companies, universities, and research institutions; and world-class talent.

The foundation is here. But success requires scale, agility and cost competitiveness to compete at home and abroad.

What we are lacking is a co-ordinated national strategy and focus to make ICT a priority.

Although many companies – including Nortel Networks Corp. – are making individual contributions and are collaborating with one another in specific areas, industry, alone, cannot tackle this challenge. To ensure success, our communications ecosystem must be made stronger by the participation of government at all levels.

How can governments help? In many ways. By making ICT a policy priority. By showcasing the abundant Canadian capabilities in next-generation technologies and applications through purchasing initiatives, especially when they are comparable in deployment and competitive in price. By moving faster to implement the next generation of wireless technologies and to make high-speed broadband connectivity available to all communities across the country. By ensuring a competitive tax environment for research and development, which will also help offset the reality that today Canada, with its strong dollar, is considered a “high-cost” place to do business. And, by getting very serious about promoting science and technology in grade schools and high schools to address the rapidly declining enrolment across the country in these disciplines at the same time that large parts of our aging work force are heading into retirement years.

As change accelerates across the converging telecom and IT landscape, I am optimistic and energized by the opportunity in front of us to help shape that future, to restore Canada's historic leadership in ICT and, ultimately, to bring significant benefits to all Canadians. But the time to act is now, before it really is too late.

John Roese is chief technology officer at Nortel Networks Corp.

The real focus of this blog entry though is to highlight yet another example of the repositioning of Nortel and our increasing visibility in the industry as we execute on our strategy. Earlier today, the London Organising Committee of the Olympic Games and Paralympic Games (LOCOG) announced that it has selected Nortel as the  official network infrastructure provider for the London 2012 Games. (Click here to read the news release.)

As many of you know, Nortel was selected last year as the Official Converged Network Supplier for the Vancouver 2010 Games. Now with the selection of Nortel to deliver the robust and scalable network infrastructure required to stage London 2012, we are seeing a significant endorsement that Nortel can – and does – provide technology that is scalable, secure, reliable, and advanced enough to be a foundational element of some of the most visible events on the planet. I look at this as a ringing endorsement of our R&D capability and product excellence. That’s particularly true when you consider that support for the Games is equivalent to building from scratch the infrastructure necessary to underpin a Fortune 100 company, placing it at the center of the world’s attention for a month, and operating it flawlessly behind the scenes to stage truly momentous activity.

What is also interesting is that Vancouver 2010 will be the first all IP-based Games and now London 2012 will progress that further to be the “Games for the Connected World.” The Olympic movement understands that it is the focus of the world for a few weeks every two years, and it also recognizes that not all of the world’s population can attend the Games in person. So bringing the experience to the world places huge demands on the telecommunications infrastructure. At the same time, every year more people are added to the Internet and their experiences are increasingly more complex and demanding. It is easy to expect that the amount of video content created and delivered over the network that will support London 2012 will be greater than any Olympic Games staged before. It is also easy to anticipate that the sheer number of people watching and their desire to collaborate and interact will be greater than ever before. That is one of the fascinating parts of being involved in the Games – every time the event takes place, it reflects the growing demand and consumption of communications and the increasing sophistication of the collaboration technology that we in the industry deliver.

As I have blogged about before, Nortel’s view is that, in the hyperconnected world, two needs are present. First, we must continue to innovate and deliver true broadband experiences where the cost and complexity of transport are driven down while the capacity is scaled up significantly. In many ways, when we released our 40G/100G Adaptive Optical Engine, Nortel demonstrated this expertise by not just scaling the capacity 4X but also by doing so over the existing fiber optic infrastructure and topology. That unique advantage saved our customers huge capital and construction costs and, most importantly, allowed them to scale instantly.

Second, we recognize the responsibility to communications-enable the IT world. In support of this, yesterday Nortel fully released our Agile Communication Environment (ACE) which allows customers to present real-time communications services to their ENTIRE IT ecosystem of applications, even in heterogeneous environments. This capability suddenly allows for the unlocking of all of the rich telecom capability present in networks by the entire applications world of an enterprise. This technology will bring information and communications together in a simpler and more effective way than ever before. In terms of the Olympic and Paralympic Games, the need for true broadband and communications enablement of IT will be a critical aspect of the underlying communications infrastructure. As such, our selection as the network infrastructure provider to the London 2012 Games (like Vancouver 2010 before it) is both an endorsement and a validation of the criticality of Nortel’s technology and our industry leadership.

Our involvement will include transport and real-time infrastructure and the technologies that communications-enable the experience. Our expectations are that we will deliver carrier-grade, robust, and scalable systems that cannot fail. The benefit to Nortel will be that we will once again participate in a great and profound experience and, most importantly, will further validate that we can – and do – build the most advanced and trustworthy technology solutions in the communications world.

The entire Nortel family is tremendously proud and gratified to have been selected by LOCOG for London 2012 and is excited to again be a partner in what can be viewed as the most visible event on the planet.

I’ve never met Dr. Rudolph Kriegler – he retired from Nortel in 1998 as a Fellow Emeritus, after a 32-year career with the company – but I’ve certainly heard a lot about him since I joined Nortel two years ago. Not only was he a brilliant scientist, but from what I understand quite a character (as brilliant scientists often are).

In this post, I wanted to take the opportunity to publicly congratulate Dr. Kriegler (who is known by colleagues simply as “Rudy”) on his much-deserved award and to recognize him for his contributions over the years – many of which are highlighted in the press release Nortel issued 10 years ago when he was named a Fellow Emeritus.

As the 1998 release says, "During his career with Nortel, Dr. Kriegler made invaluable contributions to Nortel's global success. He conceived and implemented the optoelectronic and high-speed electronic research programs at Nortel. The laser devices and integrated circuits that resulted - including high-power lasers for the OC-48 Transport Node (2.5 gigabit/second system) and a gallium arsenide chip set for the OC-192 Transport Node (10 gigabit/second system) - have become fundamental enablers of Nortel's high-speed optical communications products. Both the OC-48 and OC-192 systems hold commanding leads in their respective markets."

Without a doubt, Dr. Kriegler’s contributions helped lay a solid foundation for Nortel’s leadership in optical networking – a leadership that continues today because of ongoing investment and the efforts of today’s R&D teams. A great example of that leadership is our 40G/100G optical network solution. This technology platform can increase the capacity of existing in-the-ground fiber plant to 40 and 100 gigs, without the need to dig up the ground. This reduces the capital, cost and time of scaling the network. No other company in the world can do this. And we’re gaining significant customer traction, with 20 customer wins to date on a solution that has only been available since May 2008.

The recognition of Dr. Kriegler also signifies for me a sense of continuity within the company, linking our past achievements with our present leadership and even with our future aspirations. And that continuity comes through people.

As I’ve said many times, one of the main reasons I came to Nortel was because of the people – smart, innovative, and passionate, with a long history and a track record of developing products, systems, and solutions that have shaped the very nature of modern communications. That’s as true today as it was 10, 20, 30 years ago. The names may be different, but their impact is as significant.

Each of our Nortel Fellows, for example - Peter Ashwood-Smith, Nigel Bragg, Simon Brueckheimer, Alan Graves (just retired), Maurice O’Sullivan, Kim Roberts, John Sitch, Wen Tong, and Peiying Zhu - are at the forefront of their disciplines (in areas as diverse as wireless, optical, Carrier Ethernet, and healthcare) and each is playing a pioneering role in transforming the industry and Nortel. Many of these individuals have also been recognized with significant external awards, including Kim Roberts (our most prolific inventor in the optical field) who received the 2008 IEEE Canada Outstanding Engineering Award, and Simon Brueckheimer who received the prestigious U.K. Royal Academy of Engineering Silver Medal for foundational inventions that are at the heart of next-generation networks. These are just two example of many others that recognize outstanding contributions by extraordinary people.

Dr. Kriegler is one of those extraordinary people.  On behalf of all of us at Nortel, "Rudy," congratulations and thank you for the very significant role you played in establishing Nortel as an optical leader. I look forward to meeting you at some point in the not-too-distant future.

Last year, the focus of the conference was on the atom chart (which I’ve talked about in other posts) and making it real within Nortel. Today, by and large, the company is focused on creating value at the centre of the atom chart, where the six domains of interest (wireline and wireless, enterprise and carrier, and applications and infrastructure) intersect. The intersection point is where things like fixed mobile convergence, wireless backhaul, and telecom/IT convergence happen.

CEO Mike Zafirovski joined us for the Awards Ceremony, where we inducted 4 Nortel Fellows and 12 Distinguished Members of Technical Staff.

The theme of this year’s Conference was “Revolutionizing the End User Experience: How Hyperconnected People Will Live Work and Play.” All of the paper presentations, keynote addresses, poster sessions, panel discussions and workshops focused on some element of this theme. (Having the conference in Orlando was certainly an appropriate venue. It’s a city known for its entertainment and end user experiences, and is living proof (especially with the Kennedy Space Centre) of how technical creativity makes it possible to overcome challenges to achieve big dreams.)

In many ways, I view the Tech Conference as a moment in time where we put a stake in the ground and get the entire R&D community (12,000 strong at Nortel) focused on the bigger picture and the direction we’re heading.

Where we’re heading – and this was a message I think came across clearly at the recent Financial Analyst Conference– is that we are not just focused on the supply side (infrastructure) of Hyperconnectivity, which has been our traditional area of strength (in optical, wireless, Carrier Ethernet, etc.), but also on the demand side (i.e., applications), where we have a real opportunity to be a leader in the converged world of telecom and IT. Our biggest opportunity lies in the creation of new applications and the communications-enablement of existing IT applications. (The chart below shows our key areas of focus on both the supply and demand sides of Hyperconnectivity.)

We will of course continue to focus on the supply side (driving for high-capacity, low-latency, low-cost, abundant bandwidth) to ensure the infrastructure can support the growing number of applications that will ride over it. But an increasing portion of our R&D budget is being directed to the demand side, where we are combining the network capabilities and intelligence that exist in the telecom world (including real-time voice, instant messaging, video, and network capabilities like conferencing, location, presence, proximity, and identity), with the rich world of IT applications. 

Being successful on the demand side requires focus on three key areas, topics that shaped much of the conversations in Orlando: agility, network enablement, and user-centric thinking.

Agility
Although we have more to do, we are making progress by focusing on technology reuse, faster cycle times, and IT standards and tools (like CMMI, agile development, etc.) In terms of reuse, 12% of our designs today use technology that is also used in another Nortel product. That’s up from the low single digits just two years ago, and we have a target of 25%. This focus on reuse is not only lowering costs, but is also speeding our ability to get things out the door more quickly.

We’re also very much focused on reducing cycle times. Our Open Innovation Lab (a small group that’s part of our advanced technology efforts), for example, is exploring new technologies by building prototypes and proof-of-concept demonstrations targeted at revolutionary user experiences. What is most significant about these prototypes/demos, however, is not the actual service itself, but the fact that this building block approach is enabling a new operating model - small tiger teams working hand-in-hand with customers to create new communications-enabled services within weeks versus the months/years it would have taken in the past. This model is also opening up many customization opportunities for our Global Services team.

Network Enablement
The value we bring to the converged IT/Telecom market is world-leading telecom knowledge and understanding. We are experts in real-time communications, and know all about designing for scale, dependability, resiliency, reliability, quality, and availability – characteristics that have not been synonymous with the IT world. These are incredibly important attributes and of distinct value to the end user. My message to the design community during the Conference was that we cannot lose sight of that.

Our focus is on taking the communications functionality and capability that exists in the telecom world and marrying it with the IT world. I’ve talked about this in other posts.

User-Centric Thinking
In order to revolutionize the end-user experience – and to be successful on the demand side - it’s essential that we look at the experience from an end user’s perspective. It sounds obvious, but in a large technology company it’s not always a given, particularly when telecom equipment vendors have historically been two or three steps removed from the end-user.

That thinking is starting to change. A big part of the goal of the conference was to challenge the design community to put the end-user first. Identify the needs that are not being met. Ask the question “How can we make the human experience more productive, more effective, more enjoyable? What’s wrong with healthcare? How can we improve education? Wouldn’t it be great if we could (fill in the blank)… . And then, once the need is identified, work backwards from there.

Nortel used to have (before the telecom bubble burst) a world-leading end-user design capability, led by an internal group called Design Interpretive. Close to 100 individuals that ranged from industrial designers, to sociologists, to psychologists, to graphic designers were all focused on ensuring we were designing with the user of our products in mind, and also the customer’s end user. With the bubble burst, this capability went away, as it did in many other companies in our industry. We are slowly starting to rebuild that capability inside the company, and already are seeing very positive results.

Our challenge – and our goal – is to institutionalize that thinking across the company.

In all areas on the demand side, we’re making progress. We also have scores of examples of applications that are revolutionizing the end-user experience. Here are just a few that are gaining traction with customers:

• a “Rendezvous” service that enables you to plan an event with friends based on your location and their availability, hold a quick conference call that is automatically set up by the system (no one needs to dial in), and provide everyone with directions (which, again, is done automatically by the system);
• a “LiveContact” prototype that makes it possible for users to use their existing phones and any web browser to create an integrated experience with voice, video, IM, application sharing, co-browsing, etc.;
• a “LoneWorker” solution that helps keep social workers who go into potentially hostile environments in constant contact with their supervisors, increasing their safety and, if needed, the response time of emergency vehicles;
• a “Collaboration” solution that uses spatial audio to enable you, when you’re in a conference call, to track each individual’s audio stream, understand who is talking, and engage in sidebar conversations without anyone else on the call hearing;
• a “Delivery Alert” solution that enables you to specify when you would like to be notified (on the device of your choice) that a delivery or service truck is a certain distance from your house, eliminating the need for you to be waiting between today’s typical multi-hour window; and
• an “Emergency Response Solution” that with the click of a mouse brings together all of the technology and all of the people with the right skills who are the closest to the emergency situation, ultimately saving time and lives.

Last year’s Conference yielded tremendous benefits to the company. It got us focused on the atom chart, it resulted in a number of incubation projects, it improved collaboration, etc. Millions of dollars in quantifiable benefit.

I have equally high aspirations for this year. We left the Conference with a better understanding of some of the challenges and opportunities in front of us; tangible action plans from the workshops; new relationships and connections; and the collective will to drive culture change throughout Nortel by focusing our efforts on revolutionizing the end user experience.

The reason I point this out is that one easy way to determine the significance of a technical inflection is the level of defensiveness that emerges when a technology is challenged by a viable alternative. I remember when the Token ring camp (which I was involved in) determined that “this Ethernet thing” was not robust, predictable or mainstream enough to be relevant. I also remember when the Novell IPX and DECnet camps argued that Internet Protocol (TCP/IP) was also not sufficiently mature to be used in the corporate world. Obviously they were both wrong and the world moved forward. Today, most new IT people don’t even know what Token ring or IPX or DECnet are (not to mention APPN, LAT, Banyan Vines, AppleTalk, and others).  

What is clear is that the technology that ultimately won each debate and became the common model was the technology that offered the lowest cost, the simplest operating model and the greatest scalability and flexibility to move forward. The industry has always gravitated to technology with those benefits.   

Once again the industry is in this debate. We are debating if the future is about the multi-protocol label switching (MPLS) path or if it will ultimately evolve to a model that is Carrier Ethernet over a high-performance optical layer. At its very core the debate is around whether or not we should use Ethernet to transport Ethernet services or if Ethernet is best transported over another technology, such as IP/MPLS.

Today, the industry is split. There are clearly many MPLS carrier customers, but there is also a rapidly growing number of operators using Carrier Ethernet (more than 40 using Nortel’s gear alone). Additionally, there are millions of enterprise customers using Ethernet as their primary transport technology. The contentious point is that Ethernet as defined by IEEE 802.3 and 802.1 was not initially designed for carrier applications. Today, however, the IEEE 802.1ah (Provider Backbone Bridging), 802.1Qay (Provider Backbone Transport) and 802.1ag (connectivity and fault management) amendments in the standards track are emerging to add the needed carrier services to an Ethernet switched network. With these technologies it is very easy to provide most Ethernet VPN services over large-scale carrier infrastructure at much lower capital cost and a simplified operating model.  

When we look at the MPLS side we see that there is significant active work and a host of draft documents and requests for comments (RFCs), which are the IETF code for a defined and generally accepted specification or document (note that I am simplifying dramatically the IETF standards process, as defined by RFC 2026, as it is easily one of the most rigorous and complex in the industry and, as such, results in very few fully standardized technologies). Even though MPLS has been in existence in some flavor since roughly 1996 (I was at many of the first meetings back before MPLS as a term existed), it is not fully standardized in all dimensions because of both the complexity and the process to solidify its real objectives.