Alcatel-Lucent Plans To Get "Back In The Game" With New Partners

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Alcatel-Lucent, the French telecommunications equipment company, was down and out and almost out of business not too long ago. According to their CEO Michel Combes, the company is bouncing back in a big way. They are looking for new partners outside of the traditional wireless carriers they have worked with in the past. They are “back in the game” Combes says. “It’s now that it starts to be exciting,” Comes said to Mobile World Live recently, at the company’s Technology Symposium in New Jersey. “In the past 18 months when we asked people for efforts just in order to recover, that’s not easy. But now that we are back in the game, we have the ability to really regain the leadership position that we had in this industry in the past, and contribute to the shaping of the market.”

“Now that that transformation is done, we need to look at how to unlock growth–profitable growth,” he said, according to Mobile World Live. “Because of course I’m not interested in growth for growth, I’m interested in what is profitable for the company and makes sense for our customers.” Combes told Bloomberg that Alcatel-Lucent will be profitable in 2014 and generate positive cash flow in 2015. Less than two years ago the company took a $2 billion loan, borrowing against its patent portfolio and assets, in order to boost finances and provide some much needed cash. Combes said the company might “disappear” due to financial losses in October of 2013. They are seeing a turn-around with a restructuring program that they call the Shift Plan. The plan has a goal of getting the company back in the black in 2015.

Alcatel-Lucent is aiming at IP networking and broadband access arenas, small cells and LTE, and fixing costs to achieve these results. They are also cutting some jobs, unfortunately. They are looking at these new areas to streamline and generate cash, much in the same way Ericsson and Nokia have in the past. Banks, television cable companies, and internet companies will all help Combes’ company as they search for business outside of wireless carriers. “We’ve done what it takes on the cost front, but a cash flow target isn’t enough to mobilize a company. The next chapter for us is about innovation and growth,” he says.