May 05, 2005

Another gravestone for UK high tech?

Commenting on the news of further misery from Marconi (my old employer).

Nothing of the £10 billion contract to renew BT's network has been awarded to the sole remaining U.K. telecommunications equipment maker, Marconi. Marconi just couldn't afford to make such a large contract a "loss leader". Companies such as Ericsson, ten times the size of Marconi, were able to offer very low prices as they had deep pockets and felt they would be able to generate hugh revenues by licensing what they develop for BT to less technologically adventurous network operators.

The government's blagware about Broadband Britain is looking increasing dubious. The UK's capability to develop its own telecommunications infrastructure is crumbling as the workers with the necessary skills lose their jobs and change careers. You wouldn't see USA, Japan, France or Germany let their high technology infrastructure go down the drain like this.

- 3 comments by 1 or more people Not publicly viewable

  1. George – as another ex-marconi employee I heard the latest news with mixed feelings.

    It's sad to see what might be the final demise of what was once a great company in the UK - on the back of Rover it's potentially another massive blow to the Midlands.

    But, about a year ago I met up with a few people who had stayed on – higher end of middle managers – and despite the previous few years rather humbling experiences, the old arrogance and swagger was already back. There were lots of comments about how everyone had started upgrading to the latest Beemers and Mercs and how Marconi was ready to screw the competition again – there was not an ounce of humility amongst them.


    Also, I did comment at the time Ben Verwaayen took over that he would probably work hard to reduce BTs reliance on Marconi kit – especially as he was a Lucent employee and so probably knew the competition inside out – and guess what, first opportunity BT drops Marconi. I don't think it took BT long to work through the smoke and mirrors put up by Parton et al since the restructuring. There is still a fundamental weakness at the heart of the company.

    Interestingly there is parallel with Rover – Marconi recently announced a partnership with Chinese telecoms company Huwawei (did I get that right?) – now they are the leading bet to take the company over completely. Any bets on a similar ooutcome to the Rover case? I wonder how much IP was signed over in the original deal and how much more could be stripped.

    05 May 2005, 11:44

  2. Hail fellow ex-Marconi worker!

    Both Rover and Marconi do put question marks over the competence of the top management of UK engineering companies. Apparently before George Simpson wreak havoc with GEC, he messed-up his old company. Like Towers at Rover he made millions while many of the employees had/have to find new careers – in many cases at substantially lower salaries.

    At some point in my undergraduate degree course I will have to do some research. I'm toying with the idea of investigating how redundancy impacted the workers at Marconi. In particular those people who main skills were in telecommunications and so had to make a career change.

    05 May 2005, 12:07

  3. That would be an interesting topic – I heard of a few graduate trainees who had a golden hello, worked six months, got a voluntary package of 13K and walked off into higher paid jobs – cute deal if you ask me. It was harder on the engineering staff who'd been there a while – 15 years and you get little more than a grad who's been there barely a year.

    Both Rover and Marconi share a connection to the Lord of Dunkeld:

    "After first working in the Scottish gas industry, Simpson joined the then-nationalised British Leyland in 1969, rising to a Director by 1976. He became Managing Director of the Leyland Trucks business in 1983, returning to head the Leyland car business, Rover Group, in 1989, which was now owned by British Aerospace. He revived this company and was able to sell it to the German car-maker BMW."

    Funny how Simpson leaves a trail of destruction in his wake…

    05 May 2005, 14:48

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