Troubled networking equipment manufacturer Lucent plans to focus on the large service provider market in an attempt to return to profitability.
The US company lost $16.2bn (£11.2bn) in 2001, and has reduced its staff by 29,000, sold off parts of its business and been the subject of merger talks following a 28 per cent drop in turnover.
At a meeting with analysts recently the company said it hoped to achieve 10 to 12 per cent levels of growth by some time in 2003.
Lucent claimed that, despite the current economic slump, the service provider market is growing, and the largest players are still looking towards long-term growth.
Bill O'Shea, president of Lucent's Bell Labs research and development arm, said: "We are trying to position ourselves as a partner of choice for large service providers."
However, Keith Humphreys, an analyst at EuroLAN Research, thought this was the wrong strategy. He said one reason why rival companies such as Cisco have survived the downturn is that they have not focused heavily on service providers.
"The infrastructure roll-outs of service providers have dried up. I think it will be a long time before they start spending money again," he explained.
"Avaya Communications has significantly outperformed Lucent since it separated from Lucent Enterprise Business Systems Group a year ago. Lucent has stayed firmly focused on service providers and has lost out big time because of this strategy," he added.
The company has said it is assisting service providers with a full range of products and support.
"We have a large services capability through our Worldwide Services Organisation, which employs 24,000 people globally," a representative said. "The unit will carry out the network planning, integration and management work for service providers and large enterprise customers."
Despite the company's direct service to large service providers, the representative told vnunet.com's sister publication Computer Reseller News that the firm will continue to sell its low-end products through the channel.
"We will place more importance than ever on our channel partnerships. We will continue to sell access and firewall products through resellers," he said.
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