Gartner Dataquest Says Telecom Recession Will End One-Stop-Shop Vendor Dream
Research Report Examines How Telecom Vendors Will Need to Reinvent Themselves
EGHAM, United Kingdom, November 26, 2001 - The economic slowdown will spell the end of the one-stop-shop telecommunications vendors, according to Dataquest Inc., a unit of Gartner, Inc. (NYSE: IT and ITB).

"Of the world's eight leading telecom equipment vendors, all of which until this year were aiming to become suppliers of practically all the gear needed by their carrier clients, none will be able to realize this dream," said Bhawani Shankar, principal analyst for Gartner Dataquest's Worldwide Telecommunications and Networking group.

"Although the leading players will remain, their product portfolios, their market focus and, indeed, the nature of their relationships with their clients is destined to change radically," Shankar said. "Large diversified vendors will transform into suppliers with significantly narrower focus, and there will be a lot to differentiate the enterprise vendors from the carrier vendors - a marked departure from the verticalized business models that most vendors were trying to adopt until recently."

Gartner Dataquest has released its latest telecommunications research Spotlight report "Shake-Up Looms for Eight Leading Telecom Vendors," which examines how the world's eight leading telecom equipment vendors are positioned today and what they need to do to succeed in the future.

The report provides detailed analysis on Alcatel, Cisco Systems, Ericsson, Lucent Technologies, Motorola, Nokia, Nortel Networks and Siemens Information and Communications. These eight vendors account for about 80 percent of the telecom equipment supplied to carriers worldwide and are among the worst-hit sectors of the industry in the economic downturn.

All telecommunications equipment vendors are "refocusing," but none has a clearly articulated, long-term vision. Gartner Dataquest analysts said carrier-centric vendors with good penetration of the top 20 carriers will be among the top five suppliers worldwide in 2005. While the telecom equipment vendor landscape will continue to be dominated by mainly the same companies, the nature and behavior of these vendors will be markedly different in 2005.

Additional information is available in the Gartner Dataquest research Spotlight "Shake-Up Looms for Eight Leading Telecom Vendors." More than 30 of Gartner's 130 telecommunications analysts contributed to this analysis of vendors that are battling the economic downturn. This Spotlight can be found on Gartner's Web site at www.gartner.com/1_researchanalysis/focus/telecom1101a.html.

This research is published by Gartner Dataquest's Telecommunications and Networking group. This group provides analysis for the full spectrum of telecom and networking issues. To keep up to date on the latest telecommunications issues, please visit Gartner's Telecommunications Focus Area at www.gartner.com/1_researchanalysis/focus/telecom_fa.html. To subscribe to Gartner Dataquest programs, please call 408-468-8000. Reports can be purchase on the Internet at www.gartner.com.

Gartner Dataquest is the recognized leader in providing the high-technology and financial communities with market intelligence for the semiconductor, computer systems and peripherals, communications, document management, software and services sectors of the global information technology industry.

Gartner, Inc. is a research and advisory firm that helps more than 11,000 clients understand technology and drive business growth. Gartner's divisions consist of Gartner Research, Gartner Consulting, Gartner Measurement and Gartner Events. Founded in 1979, Gartner, Inc. is headquartered in Stamford, Connecticut, and consists of 4,300 associates, including 1,200 research analysts and consultants in more than 90 locations worldwide. The company achieved fiscal 2001 revenue of $952 million. For more information, visit www.gartner.com.

Contact:
Tom McCall
408-468-8312
tom.mccall@gartner.com
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Laurence Goasduff
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