Nortel’s $1.9B R&D Plans

There seems to be some confusion about CEO Mike Zafirovski’s promise to reveal Nortel’s $1.9-billion R&D plans this week. The $1.9-billion figure is what Nortel spent in 2004 so he seems to be implying Nortel will maintain R&D spending at the same level, even though the company has talked about having a more effficient structure by operating fewer facilities and being more focused. In any event, what Mike Z. has done is set high expectations among analysts on what he’s going to disclose this week. Given the way his comments came across during a presentation last week at the RBC conference in Whistler, analysts are probably looking for something dramatic from a strategic, operational and/or structural perspective. For more on Nortel’s future, BusinessWeek has a story in the most recent issue.


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