Alcatel-Lucent CEO seeks ‘new digital deal’ for Europe

14 Nov 2014

Alcatel-Lucent CEO Michel Combes in Basking Ridge, New Jersey

BASKING RIDGE, NEW JERSEY – Alcatel-Lucent CEO Michel Combes has called on the European Commission to come up with a digital ‘new deal’ for Europe that addresses a Single European Market for skills, e-commerce and infrastructure.

Combes, who was speaking to journalists at the Alcatel-Lucent Technology Symposium in Basking Ridge, New Jersey, said he has written to the European Commission and intends to fight hard to ensure Europe doesn’t miss out on the opportunities of the digital economy worldwide.

“It is crazy that we are not yet a single digital market,” he said.

While previous European Commissioner for the Digital Agenda Neelie Kroes worked hard on issues such as broadband and skills and abolishing roaming charges by 2015, Combes said the new Commissioner for the Digital Economy Günther Oettinger has a vital task ahead of him.

Despite Kroes’ success in key areas that will have a long-term impact, the European Union’s decision to chop €7bn off the €9.2bn earmarked to meet the Digital Agenda goals of 100Mbps for half of Europe was an area of concern, Combes pointed out.

Combes said while the EU has yet to embrace a single digital market for Europe, “China and the US are successful due to scale.

“We need to invest much more in digital infrastructure, less regulation and more long-term dynamic vision.

“We need the right framework from a fiscal point of view to unlock innovation.

“We need to reskill the youth and non-youth in Europe to embrace this digital opportunity.

“I have written to the European Commission and I have called for a new deal in Europe around the digital economy.

“We need a new dream for Europe, a new project for Europe.

“I will fight in the coming weeks and months to ensure we establish this new deal for the digital economy and I am optimistic it will happen.”

A culture adaptive to change

Combes is credited with rescuing the Paris-headquartered telecoms giant from the jaws of bankruptcy and said this week Alcatel-Lucent is two-thirds of the way towards achieving €1bn in cost savings by the end of this year.

Speaking with, Combes said a major learning and strategy for the future is that innovation should be continuous in the organisation and not done in spurts as part of a strategic plan every few years.

“You can’t be too constrained, you need to let your scientists think outside the box. At the same time, we want them to improve solutions by a factor of 10X, and not just incremental, in the context of the network vision.

“We are adding new kinds of innovations. We have our own internal start-ups disrupting technology. Our SDN business Nuage was a start-up that emerged from an idea. Bell Labs has come up with a new laser that allows us to be in the front running in terms of optical transmission. Vectoring technology is enabling fibre speeds over copper because it enables more frequency and noise cancellation.

“During our financial troubles we became less focused on innovation. Innovation is the only area I have not cut back on. Our R&D spend is €2.2bn a year and we have 700 researchers at Bell Labs and 20,000 researchers across Alcatel-Lucent as a whole.

“Now what we need to have is a culture of permanent change – the problem with big companies is they forget to change and they get hit by a wall, and that is what happened to us. It is absolutely crucial to continually reset and embrace change continuously in the company. Technology is constantly moving and you need to have new skills.

“I have reset the culture of the company to be an adaptive culture, based on permanent change and the willingness to adapt constantly,” Combes said.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years