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Nortel still signing up customers

Nortel has signed up “hundreds” of new customers since filing for Chapter 11 bankruptcy protection three weeks ago, and is reconsidering its decision to sell its Metro Ethernet Networks business.

Customers are encouraged that Nortel can emerge from Chapter 11 as a stable, viable supplier with a stronger balance sheet, says the company's Enterprise Solutions President Joel Hackney.

“We are winning new customers and contracts,” Hackney says. “We had questions whether customers were going to continue with the uncertainty, but I think our efforts in getting the message out have been fruitful and proof points are beginning to come in. The words are being followed by business, and we're very encouraged by that.”

As an example, Hackney says Nortel has already shipped 1,000 Business Communications Manager 450 units since the product's introduction last October. BCM 450 is a unified communications and collaboration platform for companies of up to 300 employees.

“It makes that the fastest (ramping) IP telephony solution we've ever launched,” Hackney says.

Hackney claims Nortel's signed on “hundreds” of new customers globally since the company filed for Chapter 11 last month. He says the company's plan to restructure its finances under Chapter 11 are on track.

He did not disclose the amount of revenue Nortel will receive from these new orders.

Analysts and other observers expect some Nortel customers to consider alternative vendors while the company grapples with bankruptcy. Some vendors are lining up with attractive incentives to entice Nortel customers to swap out equipment.

But Hackney says he is not aware of any customers migrating away from Nortel.

“We haven't had any customers reverse any orders,” he said.

Observers also expect Nortel to sell off assets as it restructures under Chapter 11. The company last week exited the mobile WiMAX business as it pares down its Carrier operations, and last September put its Metro Ethernet Networks (MEN) unit up for sale.

But Hackney says he is not aware of any offers the company may have received for any of its assets since the filing. And he says Nortel may now take its MEN business off the selling block.

“We are reassessing that decision to potentially sell MEN,” Hackney says. “With the actions we're doing on creditor protection, it gives us time to reassess that. The industry has clearly shown that the MEN business has some strong technologies.”

Reports surfaced that three credible bids emerged for the MEN business but to date it remains unsold.

Separately, Nortel named former HP ProCurve executive John McHugh as vice president of Enterprise Solutions. McHugh has been at Nortel since Jan. 1.

McHugh will be responsible for marketing Nortel's portfolio of data networking products for the enterprise and will also assist the company's development of Ethernet technologies for Nortel's carrier business.

McHugh, formerly vice president and worldwide general manager of HP ProCurve, left the company in June of 2008.

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