Canada Should Nationalize MEN?

I think they should nationalize MEN and WOMEN… fair is fair…..sexist pigs…hmmmm… uh…er… what were we talking about?……..

I'm not buying this article at all. As with so many other articles about Nortel these days, the reporter makes a lot of statements that make no sense to me.

Problem #1: “There is no apparent effort to ensure that Nortel remains a Canadian company.” => If you look at the numbers, it is not a Canadian company. Maybe the HQ is in Canada and R&D largely in Ottawa, but likely only for tax purposes. Most of the operations are outside of Canada. Most of the money generated and spent is done so outside of Canada.

Problem #2: “Nortel..could operate as a viable business if it weren't for the large amount of debt it accumulated”. Says who? Yes, debt is a massive part of the problem, but it didn't appear overnight. It happened because of poor management and an increasingly complex corporate structure.

Problem #3: MEN is profitable. Do we know that for sure. MEN is a P&L but due to the complex Nortel accounting, does anyone at Nortel really know how much it cost to run that business?

Problem #4: “Nortel University … has been the incubator for most of the high- tech firms in Canada”. Really? The attrition rate at Nortel was one of the lowest in the industry, meaning that many people got a job and stayed. Which high-tech firms did they go to? They didn't. If anything, Nortel's decline was robbing the high-tech industry of talent because as Nortel slowed down, other high tech suppliers in the country slowed down as well, and had to lay off or not hire those engineers…

Problem #5: “Once the number and size of high-tech companies drop below a critical level in Canada, the incentive to start a new one here will disappear.” Hello? Where does this analysis come from? Yes, high tech might beget hightech, but Nortel was not fueling the entire high tech industry in Canada. There are many many high tech companies out there (not just telecom) that have done and will do just fine with or without Nortel.

Problem #6: “Once Nortel's real assets, the technology and customer base, move into foreign hands it will be only a matter of time before operation in Canada ceases to exist.” Didn't she say the employees were the assets? Anyhow, the customer base is not in Canada. It's a tiny percentage of overall sales.

Problem #6: “Perhaps the federal government could buy this division, minus the executives and managers of Nortel, and turn into a crown corporation. Let the current division head continue to steer this division – the only profitable one at Nortel. The government and taxpayers would recoup their original investment in a couple of years.” HELLO????? The federal government would have NO IDEA what to do with a company like this. If they did, Nortel would probably have not gotten into such a mess (remember Manely is on the board). Imagine – give MEN to the CRTC to oversee. AHHHH!!!!!!

I do like the little comparison to the Avro Arrow jet, mind you. That one tugged at my sentimentality.

When Nortel said last November that MEN was up for sale, I thought that of all business units, that was the one to keep as I think it best reflects the Canadian part of the company.

I say the feds should buy it then give to RIM. I'm sure Jim Balsillie and Mike Lazaridis could make something of it. What, exactly, I have no idea. But since it seems like anyone can say anything about Nortel these days, I'm joining in.

At least a refreshing comment in all of these!!

Many thanks for making me laugh.

Nortanic is a far cry from the Avro Arrow or Cisco this lawyer compares it to. The 40/100G technology is just a buzzword today and not of age with increasing competition in the future. Aside from the hailed 10 to 40G migration where I question how profitable this is not replacing much.

Avro was not embroiled in Canada's largest fraud, had reliable numbers, and didn't leach the company into it's final days with bonuses.

Yesterday's front page showed how there was no bailout for Abitibi or GM/Chrysler so why would they bail a company who exports jobs as they already burden taxpayers through UIC cutting severances and EDC.

This lawyer is out to lunch to propose or advocate continued risk for future products. Let others buy their DP-QPSK technology to pay creditors if it's so hot. Nortel already had their chance with other technologies and blew it several times over let alone afforded yet another amid unbelievable blunders and bonuses.

Perhaps money making and job creating RIM-envy is best exemplified by their pals at the OSC who fined the Nortel dinosaur nothing for the largest fraud settlement in Canada. Yet these contrary to and poor excuse for a watchdog fine RIM a whopping 70 million for options backdating, even though both companies went to the joke of a regulating authority before this joke of a regulating authority came to them. (OSC's head makes a multiple of the SEC's and Nortel's CEO mades more than BCE's, a joke)

RIM never greased the palms of foreign spys or sold technology to governments to spy on their own citizens either. RIM is exponentially more ethical and transparent, involved in philanthropy, and doesn't need to be infected by a ambiguous tyranny to look like they are keeping afloat with handouts or printing paper or selling assets while forever downsizing, etc.

The only thing RIM lacks are with talents to patronizing and lobbying like the masters of deceit and delay Nortel.

The days of airbusgate and adgate greed are over contrary to Nortel getting bonuses approved after bankruptcy and without creditors blessings, there is a new sheriff in town. Even our Ontario's Premier is disgusted how they circumvent severances under bankruptcy laws.

The old dinosaur ways of Nortel are gone, only the Business Prevention Departments like the OSC and EDC remain with their cob webs to grease the palms with many millions and all sins forgiven.

Is Julie Taub perhaps the broad that got slapped by Acne, and is still nursing a secret crush on him?
In theory her idea sounds pretty noble. Taub (German: “deaf”) writes that MEN has a “respectable lead in 40/100Gb/s optical technology”, so it could have enough time to succesfully restructure under new management and still maintain that lead.
Just have the govt strip away debt and complicated junk, make business simple, and put it back in the hands of Canadians, who will run it for the Candian people. Keep it non-profit so theres no incentive for robber barons to invade, plunder ideas, talent and money,,, you know… unlike some other governments…(ahem) nearby..
This socially-conscious business model would be nurtured in collaboration with and exported to other like-minded countries. Built it and they will come.

If the government can spend millions to bail out U.S. auto companies in Canada, which truly have been manufacturing inferior cars for decades

Inferior to – Canadian cars? Uh-oh, Godwins Law is getting ever closer:

None other than Germany is currently offering a ca. $4,000 “salvage premium” to potential car buyers whose vehicles are 9+ years old. Its goal is to put only “Euro 4″ emissions compliant vehicles (i.e. superior, German) on the road… and, okay, also (cough) stimulate the economy…

http://www.cbc.ca/consumer/story/2009/02/05/ger…

Ferdinand Dudenhoeffer, a professor of automotive economics at the University of Gelsenkirchen, said Merkel's move was little more than a political gift to the car market and predicted only 20 per cent of the new cars sold would be from German companies
“One could say the wreck premium is an economic program for the factories in Italy, France, eastern Europe and Korea. For workers in Germany, the bonus will contribute little,” Dudenhoeffer said.

The German govt will gift you for literally crushing whatever vastly superior-to-any American drivable 9+-year-old car you might have, regardless of its mpg/emissions/cost to you. If all goes well they'll have nary a car older than 8 years on their roads by years end. Its all about the envornment, safety, and non-profit. Or maybe not quite:

Additionally, Volkswagen AG on Monday unveiled an “Environment Premium Plus” program to provide additional incentives — such as price reductions and cheaper financing — to customers taking advantage of the government bonus. With the added VW incentives, Kamand said he would be able to knock almost $7,200 off the sticker price of close to $32,000.

VW wiper blade: $780
Generic wiper blade made in China: $23

It is like holding hostages.

Who else would oversee winding down operations while trying to sell remaining assets let, alone hammer out what might be salvaged in any restructuring.

Maybe they considered it punishment pay to stay on =)

Ya, and so much for Nortel's Green campaign kickbacks and Cisco Tax slander =)

you have issues, your post was less than 5-paragraph long

So how does China finance its global village ideal:

http://news.bbc.co.uk/2/hi/health/216998.stm

Smoking could eventually kill a third of all young Chinese men if nothing is done to get them to drop the habit. Two landmark studies involving 1.25m Chinese people show that China has the largest number of smoking-related deaths in the world.
Because of a sharp increase in cigarette sales in the last 30 years, around 2,000 people a day are currently dying of smoking in China.
By 2050, the researchers expect this number could rise to 8,000 a day – some three million people a year.

Chairman Mao is said to have promised Chinese people food, shelter and cigarettes as part of the communist revolution.

…despite Chinese health officials' backing for efforts to reduce tobacco consumption, treasury officials might find it difficult to say no to the huge revenue they can reap from the cigarette industry.

The Chinese govt kills its people to fund Huawei. Money isnt free in China either. So whats Canada gonna do? Drill for oil after all?

Its a Nortel Center of Excellence!

well, but China is communist and Canada isn't… I think that changes things

Previously yes, but now they are capitalist.

I take it all back. Worldwide financial support is all but guaranteed as Nortel is saving the whales:

http://washingtontechnology.com/articles/2009/0…

,Some long-term government projects might take five or 10 years to complete.

In 1999, Nortel developed the MSRS system, which automates the collections and distribution of information on the location of right whales and ships of more than 300 tons.

What other company can boast of having virually secured green contracts over the next 100 years?

Nortel Government Solutions recently won an $800,000 recompete to keep working on the project, has developed software and relational data bases as well the communications connections to build the system.

$800,000. $800,000

“In Center of Nortel are onry Excerences” cheer their Chinese corraborators!

Mike is the core of Nortel. (and he mentions the word “core” a lot… whenever “focus” isn't handy..)

From wiki, and let's assume it is correct
“…It is a socialist republic ruled by the Communist Party of China under a single-party system …”

and China Citizens have lots of freedom too, right? They don't ban any websites in China, right?
And the Government doesn't control many companies at will, right?

Didn't men to disappoint such an avid reader.

What's that average out to? 80 to 160K a year? That won't buy new shoes.
Besides, the humpback (no pun intended) has made recent gains!

This was PEC before Nortel bought its declining earnings for growing revenues at $448M US (pegged at less than half so shortly afterward at $200M). I wonder what it is worth today, if there was any interest of course.

Save the whales but cut the shrimps' severances, heh… oops

So where are all the truly free webstes that burst forth in truth located? Or is too dangerous to ask/tell?

no no 2009

How silly.

Being screwed by Nortel daily has been bad enough… although maybe a RIM job would help alleviate the pain.

Ciena it likely is.

A more compelling argument would be to get a sound management team with TECHNICAL expertise and business acumen (e.g. no prior experience at a light bulb manufacturer is actually an asset), and have the Government of Canada backstop financing in a Public-Private partnership with some Bay St and Wall St types. Calling it a bailout or crown corporation is a great way to undersell the best gem within Nortel. The author should be flogged for that.

There is no reason MEN couldn't compete as a standalone entity on the size & scale of Ciena or Juniper. Having some fresh senior management and product line managers with optical industry experience would allow MEN to take flight as a standalone company. Given Nortel's hiring lock for the past 6 years, some external management talent would make a good complement to a strong engineering & software team that have been sheep without a shepherd for far too long.

Otherwise, selling off the division will be the typical Harvest IP for a Year->Fold into mothership->Fire all the ex-NT division employees and shut down site cycle that inevitably happens in each acquisition.

And Terry Matthews would undoubtedly welcome the added rivalry in the Ottawa market.

Somebody give the Minister of Finance Flaherty and the Minister of State-Science & Technology (chiropractor and born-again creationist) Gary Goodyear swift kicks in the arse please.

Looks like a decision has been made to dissolve the company:
http://www.ottawacitizen.com/slide+into+oblivio…

Quote from the article:

The conclusion: while Nortel is leading edge in some of its main product lines, the company as a whole lacks sufficient scale to survive an industry transition that favours two types of competitors — low-cost producers, and corporations large enough to support major-league R&D.

Worse, even a large infusion of capital would not be enough to solve Nortel's problem, the summary suggests. This may be why Nortel appears embarked on an orderly sale of all, or nearly all, its key product lines and businesses — the process that has upset Ferchat and many of his colleagues