Surely these can’t be growing pains

As I listened to some of the world’s largest wireless infrastructure providers talk about their business plans last week at the Mobile World Congress event in Barcelona, Spain, I heard a lot of pain. This is not the Lucent of 2000, at $80 a share, talking about technology advances and how the world is its oyster.
No, this is a struggling descendent of Bell Labs, teamed up with Alcatel, and further teaming with NEC, to try to get a piece of the fledgling LTE market. (Is there an LTE market yet?) Are network vendors pushing for development of LTE technology so they can pin their survival on it? Evidently the rollout of third-generation networks did not bring prosperity to all.
It would be one thing if it were just one company struggling under the weight of today’s competitive pressures. But the pain of the largest network vendors seems to spread across many of the traditional players – even as their operator customers enjoy success. Ericsson has managed to maintain its first-place position, but Nokia Siemens Networks, the No. 2 global provider, talks about its disappointment in 2007 and the fierce competition ahead in 2008. Have Huawei’s and ZTE’s entrance into the networks business altered the landscape that much?
And if so, will fears be realized that in the future not enough money will be spent on research and development, which was a common threat whispered to operators if they selected the lower-cost Chinese manufacturers to build out their systems?
And what will happen to Nortel and Motorola, once two bright stars in North American infrastructure, struggling to find a path in this brave new world? Even more so, what brought them to this place? Did the operators beat them so far down on price there is no recovery? Were they bloated to begin with? Has infrastructure become another commodity where one can only compete on price? Is this consolidation and short-term pain part of the natural evolution of the ecosystem?
I don’t know. I do know that in the 2G rollout, operators competed on price, and network providers shouldered the financial burden of the buildout. We don’t hear that so much with 3G, but some network providers are in as worse shape as they’ve ever been, What happened and how can these mistakes be avoided in our progression to next-generation networks? Write me with your thoughts at tford@crain.com.