Genband Builds on Nortel Carrier VoIP Close

Last of Nortel's big business units now gone as Genband deal closes.

By Sean Michael Kerner | Posted Jun 2, 2010
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IP gateway vendor Genband has completed the acquisition of Nortel's Carrier VoIP and Application Solutions (CVAS) business, closing the $282 million deal that erases one of the last of Nortel's large business units.

With Nortel CVAS in hand, Genband boasts a portfolio that includes VoIP networking gear and applications that it can blend with its existing networking portfolio. The sale of Nortel's CVAS business continues the former telecom giant's dissolution following its bankruptcy proceeding.

"The sale of our CVAS business to Genband enables our global service provider customers to continue to benefit from Nortel's industry-leading carrier VoIP and telephony expertise and long-standing track record in transitioning TDM networks to VoIP," Nortel President and Chief Strategy Officer George Riedel said in a statement. "We wish our transferring employees well, knowing that they are taking their considerable expertise to Genband."

Even as its ownership was shifting, Nortel's CVAS unit continued to put out new products. Just last month, the division expanded its portfolio with a new business-collaboration tool. Though Nortel struggled as a company in 2009, its CVAS business remained strong.

Nortel CVAS reported in April that its global shipments of carrier VoIP ports had exceeded 121 million units. Analyst firm Dell'Oro recently ranked Nortel's CVAS business as the No. 1 supplier in the global Carrier VoIP and softswitch markets for 2009.

Nortel entered into bankruptcy protection at the beginning of 2009 and spent the rest of the year selling off its assets. Genband bid for the made its bid for Nortel's CVAS business in December 2009 and won the asset auction in February of this year.

Other assets that Nortel has sold include its enterprise networking business, which Avaya scooped up for $900 million. One of the initial hurdles in the Avaya deal was a concern from Verizon about customer support.

Verizon is also a customer of the Nortel CVAS business, and is taking a positive outlook on the Genband ownership.

"We are a customer today of both Genband and Nortel CVAS, and we expect the consolidation of the two companies' work will provide Verizon with valuable options to continue the IP modernization of our TDM network," Mark Wegleitner, Verizon's senior vice president of technology, said in a statement. "In addition, ongoing innovation by Genband in NGN technology should assure continued progress in IP migration and IMS development that is so important to our business."

With the close of Nortel CVAS acquisition, Genband is also bolstering its management ranks to help grow the business. Former Nortel executive Jeff Townley is joining Genband as president of operations, a role that will oversee the company's professional services, support, manufacturing and supply chain divisions. In a career that spanned 26 years at Nortel, Townley rose to the position of chief procurement officer.

Sean Michael Kerner is a senior editor at InternetNews.com, the news service of Internet.com, the network for technology professionals.

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