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Blurring is just another name for…

… Blurring – aka innovation.

It occurred to me the other day, that the boundaries between service and software have been blurring for most of the past decade. I remember the day when Nortel Networks, back in probably 2000 or so, announced that they were building a 1,000 person business around the Applications Service Provider market.

The executive-in-charge, was a newcomer to the telecom space, but it was his business plan to invest huge financial resources to build 'solutions' for ASPs that took my breath away. At first, I paid no attention, but then after a couple of months, I was invited to participate in various customer briefings as a representative of my Line of Business (division). Well, in the customer presentation, it became clear that our ASP business was based completely on the technologies of other firms. It seemed that we were trying to become a 'systems integrator' for what was thought to be a high growth market segment.

My simple mind couldn't see the forest for the trees, or the blurred boundary between network equipment, software and services. I thought that the only thing my employer was going to bring to this equation was financial resources. We were going to finance the customers' purchase of software in much the same way we had financed the CLECs purchases of DMS-100 switching equipment. Except, there was no Nortel value add in the technology. No link to our technology foundries, and nothing for the customer that a dozen or so other SIs or Venture Capitalists couldn't already deliver. This was a signal to the end IMHO. It was a $200 million/year gamble. Good thing the collapse of optical in 2001 drove that unit right out the window in a hurry as Nortel and many other technology companies retreated into core competencies (that hopefully would restore stability to the revenue stream).