Nortel steps up

The networking solutions provider is increasing its focus on managed services and green technology.

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By  Sean Robson Published  November 16, 2008

The global networking solutions provider is increasing its focus on managed services and green technology. Sean Robson finds out.

Managed services are attracting increased interest in the Middle East and Nortel is just one of the global players eager to grab a foothold in this lucrative market.

"First, I think it's important to note that the Middle East is a very important region as far as Nortel is concerned. One of the trends we are seeing globally is that this region and emerging markets as a whole are growing much faster than the more established or mature markets," says Calum Byers, vice president global services EMEA, Nortel.

What we are increasingly looking at doing is putting a wrap around those products in terms of additional services.

Byers estimates that revenues from managed services in EMEA comprise more than a quarter of Nortel's overall revenues from the region. "We are seeing the revenue change and grow as we evolve in terms of these services. Our background in these offerings began mainly with the back-end but gradually that has changed as we become more involved in the application side," explains Byers.

According to Byers, Nortel is observing a lot of growth in enterprise managed services as well as in services aimed at network operators. The services being requested by clients include assisted operations and network optimisation.

The strategy Nortel is using is two-pronged as it looks at the enterprise space and carrier space respectively. "We have operated in the enterprise space for a while now where we have a very strong relationship with a number of end customers, which is many times a result of the fact that we provided strong products. What we are increasingly looking at doing is putting a wrap around those products in terms of additional services," says Byers.

"On the carrier side, we have a number of engagements with telecom providers in the region, where we have gone in and delivered the products but now we are adding managed services on top of this. We can put people on the customer premises to manage that particular service and to optimise that particular network, manage it locally and to make sure that the service level agreements are fully reached," he adds.

Much has been made of the current financial crisis being felt globally but Byers believes that while this may prove a challenge to developed markets in terms of managed services, it will not affect this region as it remains typically greenfield in nature.

In terms of challenges that the firm faces with managed services, Byers points out issues related to skills as well as the geographic size of the region. "For a service provider the challenges include delivering a consistent level of service across so many countries and such a wide area. In addition, although there are employees with the relevant skill sets there is a significant lack of depth of knowledge," Byers says.

Byers believes that from a client perspective a significant psychological jump often has to be made when outsourcing services. He says that with the managed services paradigm having shifted from all-encompassing long term agreements to shorter more service specific agreements, users are required to take a holistic viewpoint.

"We have to keep in mind that the market here is ahead of the other emerging markets, and as networks become more complicated and cost pressure starts to build the demand for services is being driven even further," emphasis Byers.

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