It's business as usual at Applinet Dear Customer,
As you are most probably aware on the 14th January Nortel filed for creditor protection in Canada, the United States and Europe in order to undertake a comprehensive business and financial restructuring program which will no doubt be causing you concern.
Applinet plc are a major solutions provider of Nortel technology and a number of our service offerings and solutions are based on their products. I would like to share our point of view on the situation and our strategy moving forward.
With the current pressures on the global economy and the effect this is having on all markets, businesses and individuals we are seeing significant organisations and brands rethinking their strategy. We believe that we will see many more in the future. The economy is changing and with this the way that businesses work will also change. Through this period the need for change will mean hard decisions have to be made. Nortel has had to make a hard decision, and we believe the right decision, not only for them but for their customers and partners alike. This is not a time for knee jerk reaction, but careful consideration of the facts and not the media hype.
Applinet expect to see Nortel’s competitors attempting to exploit this action in order to divert attention from their own business challenges. Whilst Nortel are one of the first to take this action they will almost certainly not be the last.
Nortel have been making minor changes over the last few years, but never really recovered from the year 2000 dotcom crash. Now there will be significant focus in a timely manner to restructure the business correctly and build a strong and stable foundation for the future. We feel that this is a positive move for all its stakeholders, customers, end users and integrators like ourselves.
Nortel have committed to Applinet that it is business as usual for sourcing, supplying and supporting the Nortel product in the foreseeable future. Nortel have committed publicly to continue to invest in $1.7Bn into the Research & Development of their portfolio and the delivery of the Plan of Record (PoR) in the key product areas, including the Enterprise portfolio.
Below is an excerpt from Nortel’s communication to their partners last week:
To be clear Nortel is not bankrupt, it still has a strong cash position of $2.4billion as of December 2008, and has still a strong, loyal customer base that continue to secure impressive wins for Nortel globally. CCAA / Chapter 11 are legal processes that allow a company to continue to operate its business while it restructures its debts in an organized, court-supervised setting. Nortel will emerge from this process a better organisation.We do not expect this process to impact Nortel’s normal, day-to-day operations. We acted now as Nortel has sufficient liquidity to run our operations and restructure our business while continuing to deliver innovation for our customers. This is a solution to Nortel’s challenges, and we intend to emerge from this process a more focused, financially sound and competitive company. Throughout this process:
No impact is expected on your business with us Continued high quality services and support will be provided Ongoing R&D investments will be made Constant communication will take place We will respond to your needs with high quality products, solutions & services Nortel will emerge more focused and competitive at the end of this process. In summary, I would like to reassure you, our customer that it is business as usual with Applinet and we continue to service and develop our Nortel relationship with you. Our business is built on a service model which allows us to have more predictable results and gives us self sufficiency and independence from the fortunes of our suppliers at times like these. We also took the decision last year to add complementary offerings like Microsoft OCS and Unified Communications solutions into our portfolio, to spread the risk and be more diverse in the changing IT market. We have more partners in Wireless, such as Cisco and Trapeze, and recently developed our Network Services division offering a nationwide bandwidth and call minute solution that can be centrally managed by Applinet.
Nortel is still very much in business and it is business as usual. Chapter 11 is not a problem, it is a solution that allows Nortel to take stock of the situation whilst having the funds to execute a definitive restructuring programme, to allow them to emerge as a stronger, more focused provider. We are able to continue our business as normal and of course offer our existing services and solutions to support our strategy.
I would like to thank you for your patience and support. If you would like to discuss further please do not hesitate in contacting me on 01635 848925 or my mobile 07776 206918.
Yours sincerely
Darren Boyce
