8. Lucent Technologies

It is the same Lucent Technologies that was almost being sold to Alcatel, is

still in a financial mess, and is in the news for all the wrong reasons in the

US. Well, that is in the US. This is India.

If one measures the company by its performance here, impressive is a modest

way of putting it. The company grew a whopping 85 percent to reach a revenue

figure of Rs 841.3 crore, (as estimated by Voice&Data- the company failed to

provide its financial data) and jumped to No. 8 in the elite Top 10 Club of this

year’s V&D100 ranking.

Holistically speaking, three things helped the company.

One, the Indian team of Lucent is arguably the best among those of all

telecom equipment companies in India, ably led by Vijay K Gupta, an industry

veteran.

Two, its financial mismanagement notwithstanding, Lucent remains one of the

two evenly balanced carrier equipment companies in the world (the other, of

course, is Nortel), with a real understanding of the needs of the traditional

telecom world, and a fairly good solution portfolio in the emerging

broadband/packet world. A technologically-aware but risk-averse market like

India needs just that. No wonder, almost all the private fixed service providers

chose Lucent.

Three, all the fixed line providers, which Lucent has sold to, have gone for

a combination of broadband and wireless for access. And that has been the

deciding factor in choosing the vendor, in most cases. In wireless, access,

India has whole-heartedly gone for IS-95 CDMA. And the only company having IS-95

expertise as well as a proven track record in switching, is Lucent.

Speaking of financials, the revenue break-up was a healthy 60.7 percent from

the private service providers and the rest 39.3 percent from BSNL/MTNL/C-DOT.

Segment wise break-up figures are 80.4 percent from fixed services (including

BSNL and MTNL), 13.7 percent from cellular, 5 percent from long distance, and

less than 1 percent from ISP segment.

Primarily, it is the fixed service segment where Lucent did its major

business. The major orders that it received last year were from private fixed

service providers–a Rs 282 crore order from HFCL Infotel executable in five

years and a Rs 145.7 crore order from Tata Teleservices for five years.

Despite Lucent’s impressive performance in India, its future is uncertain

as its parent company is yet to come out of its crisis. Also, as more new

networks get built out in long distance, Lucent will face tough competition from

Cisco and Nortel, and also from new generation companies like Juniper and

Unisphere. The other thing that Lucent will have to worry about is the

significant outstanding amount that it has to recover from the private service

providers.