It's been quite some time since I blogged. But I'm back :)
Yesterday, a typical Sunday night, I had trouble to sleep. So I opened Feb's issue of MIT Technology Review.
There was a good article on how Lucent lost its empire. There were four reasons attributed to their downfall:
1) Lucent ignored the long standing telecom customers and went for the startups, a large number of them had cropped up due to deregulation in the US telecom sector. These new guys had no initial capital to purchase telecom switches and Lucent lent its products to them.
2) Though these smaller customers were yet to prove viable, they were very demanding. These smaller guys wanted to build the data telecoms of tomorrow. Lucent, having the ancestry of AT&T was not playing in the data domain. So it frenzied to acquire startups in large numbers...many of them had not even proven their might.
3) Lucent ignored the cry of its insiders for developing its Optical switching business. Soon Nortel captured 90% of this market segment.
4) And lastly, Carly Fiorina's 20% year to year sales increase pitch made the accounts bloat with fudged data. The company even allocated 8 billion for lending products to its customers. At one point of time, Lucent was literally giving away its products to meet the inflated sales goals.
