Avaya and Nortel Enterprise: Now for the Hard Part

avaya-nortel-enterpriseSure, Avaya has won the auction to acquire Nortel Networks’ enterprise business. But now the real fun starts. Here are the top three partner and customer questions Avaya needs to answer as soon as reasonably possible, according to The VAR Guy.

First, in case you hadn’t heard the news: After a three-day bidding process, Avaya has agreed to purchase Nortel’s enterprise business for $900-million – nearly double the $475-million “stalk horse” bid it made last month, according to All About Nortel (a top blog covering the imploding networking company). The final transaction is subject to court and customary regulatory approvals in Canada and the United States, according to an Avaya statement.

Three Questions Worth Asking… And Answering

Assuming the deal receives approval, here are the top three questions Avaya needs to answer:
  1. Which employees stay, which employees go?: Nortel enterprise customers and partners are tired of living with uncertainty. The faster Avaya can reasonably detail its retention plans for Nortel Enterprise employees, the better. To Avaya’s credit, Avaya has put aside $15 million for a Nortel Enterprise employee retention program — which could keep Nortel Enterprise employees loyal while Avaya solidifies a business strategy for the takeover.
  2. Which products live, which products die?: Surely, there’s VoIP and unified communications overlap between Avaya and Nortel’s enterprise business. Avaya should steal a page from the HP-Compaq merger. Although that PC deal hit plenty of bumps, HP did a very good job of communicating which products would live on and which products would die under the merger. A prime example: As soon as the HP-Compaq deal was finalized, HP killed its own x86 server family and rallied around Compaq’s far-more-popular ProLiant lineup.
  3. Which partner program components live, which die?: Juniper and several other networking firms have been recruiting partners away from Nortel for several months. In order to stem those partner defections, Avaya needs to quickly and continually communicate with Nortel’s enterprise partner base. The VAR Guy wonders if some of that communication will occur during Avaya’s partner conference, scheduled for mid-October in Nashville, Tenn.
Alas, The VAR Guy isn’t sure whether the Avaya-Nortel Enterprise deal will close in time for that October partner conference. But our resident blogger will be watching — and listening — closely.
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