Shame on you, Wall Street. It's not always who you know.With cynicism having replaced optimism as investors' outlook of choice, it's little wonder that Ciena's ( CIEN) big deal with British Telecom ( BTY) was the subject of some snickering this week. After nearly two years of courting BT's business, Ciena finally brought home a
Still, as inviting as the shareholding question is to certain black-helicopter types, that's not the only reason Bross' name attracts attention. After all, the executive had made a name for himself as a telecom power broker long before he crossed the Atlantic. Prior to his BT job, Bross was tech chief at the failed Williams Communications. Probably his most notable achievements there came from his
shrewd ability to obtain cheap pre-IPO shares of emerging networking companies and then cash in the stock during the hot and heavy rise of the Nasdaq. At one point with ONI, for example, Bross held 1.9 million shares, nearly 2% of the company. Interestingly, Williams Communications was also not only a big ONI investor, but ONI's top customer early in its short life. Bross and Williams also brokered an arrangement under which Williams would agree to buy gear in exchange for a stake in the pre-IPO company. ONI needed customer commitments to interest investors in the company and go public. Bross eventually cashed out most of his shares for more than $40 million. As one networking analyst said: "He was by far the most brazen about the pay-to-play arrangements." But going by what BT says, the Bross chatter undermining the Ciena win was misguided. Now it seems clear that Ciena's landing a coveted BT supplier role ranks as a major victory for the company's risky damn-the-costs strategy. Seeking to set itself apart from the pack, the Linthicum, Md.-based networking shop has boldly vowed to ignore losses and sell its way to success, as its rivals Nortel ( NT) and Lucent ( LU) cut staff and shrink their product offerings to survive the postboom tech recession. The British Telecom win not only validates that gutsy strategy, but instantly catapults Ciena into the Net gear big leagues.