Ottawa Didn’t Kill Nortel; Nortel Killed Nortel

Bravo mark !

Mark-

GREAT POST ! This should be published in the Toronto Star as a rebuttal to the editorial. Everything you said is dead on.

GP

For all interested Parties I've listed the Nortel Killers for your enjoyment–>>>>>
–> The Board of Directors first and foremost.
–> Roth, Dunn, Owens, Mike.
–> Gov't Inaction at Federal, Municipal and Provincial Levels particularly past few years.
–> Gov't unwillingness to buy only nortel at all three levels. Witness how the chinese Gov't buy only from Huaweii and ZTE for the mainland for all intents and purposes. Harper complaining to Obama about the buy american clause is proof. Harper, mcguinea and municipal won't buy Canadian when it comes to Nortel.
–> Inept Internal management based on preferential hiring and firing. Nepotism, favouritism and shameless promotions of many inept rank and file within.
–> Bad marketing and Sales Teams, but handcuffed by own Canadian government system at all three levels.
–> Inability to stay ahead of the curve due to all the distractions above.
–> Global Recession.
–> Cheap quality competitors like huaweii who flood the market with garbage and can afford to actually give gear away for nothing due to generous subsidies from their government.

Perhaps people should review the CDMA market facts available from the CDMA Development Group at http://www.cdg.org

If CDMA is “dead” then why is the growth forecast moving from 472 Million Users in Q1/2009 to 700 Million Users in 2013, or that CDMA/EV-DO holds a 54% Market Share for 3G Networks?

Growth in CDMA is slowing, just as growth in GSM is also slowing. However, CDMA and EV-DO will be around for many years to come. Service Providers simply can not replace 472 Million user devices that quickly.

Looks like public still does not know that
Nortel has not been profitable for years. Nortel is bankrupt.
What’s Gov role in the BK?

ICICA does not apply here
read
http://www.ic.gc.ca/eic/site/ica-lic.nsf/eng/lk…
Defunct Business
Receivership or Bankruptcy
Nortel is in final stages of assets disposal.
CDMA gone
Enterprise gone
What’s next?
MEN_optical?
I’d encourage journalists to call interested parties and ask questions_investigate.
Did “Save Nortel” group give up their fight?
What Matt_Patt the main creditor thinks about assets sale?
Will RIMM bid for LTE patents?
Is Gov going to use money to keep jobs in Canada? How?
Example Avaya
They have to cut jobs. If they cut Avaya employee they have to pay severance.. If they cut Nortel jobs, guess what, no payments…
Gov would clean Nortel in 1999-2004 so Nortel would still be alive today.

I agree with all your points
You said
–> The Board of Directors first and foremost.
I agree with that too. They are the most responsible and look, public does know nothing about them.
and for laughs
What about TiC accusations that ME Blog was used to destroy Nortel?
My posts where reflecting investors side of the view about Nortel. I did not care much what Nortel was selling just that they were selling it below costs or no profits for the corporation and benefits for shareholders.
The final chapter was easily predictable and even I did it. I predicted 2008 to be the last for the stock.
In my view, all the critical posts posted on any blog would be very helpful for Nortel if answered with proper action to correct the culture, Nortel's culture.
btw frame your top ten list and make publicly available so crooks like TiC would not lie about that anymore.

The only thing I agree with in this post is that the Gov't has no business interfering in Nortel asset sales. CDMA is not anywhere near dead and it certainly was a key area of business for Nortel as it had a huge customer install base.

Tha main point here is that singling out one piece of NT and saying because the Gov't did not stop it from being sold to a foreign entity, it caused NT to die is ludicrous. When Z and Co. decided against re-structuring and to sell off the business lines one by one until they were (or will be) all gone is what caused the end of Nortel. You could take out CDMA from this article and replace it with Enterprise and the Toronto Star would still be saying the same thing. Much more impactful than Who NT decided to sell TO, is who they did NOT decide to buy, i.e. Z and the botched Avaya deal from a few years ago. Heedless rash poor decisions down the line on top of layer of historical deceit and fraud is what did NT in.

Gov has no place in business unless it is getting into the business. If they wanted to they could have made Nortel a crown corporation. But it did not. So they can only allow it to be sold off in pieces.

They could say things all they want about jobs, patents and what not. Fact of the matter is the business goes to top bidders and they will decide what to do based on business decisions.

Expecting Government to do something requires a strategy they have not had or even been close to in decades. Because historically Canada is good at inventing / growing but not in building companies / economic value – be it space, defense, telecom, biotech, resources.

Change means a different approach from a young genereation that looks at Canada. The last time I looked the 3 parties have only old pot bellied people who can only bicker amongst themselves for power. The CPP had 400 million to sink into Skype with lawsuits around the corner. But it did not have a dollar to invest in Nortel. It shows how much value they see in their own country or of their own countrymen.

You will all find out in the end that it was strictly management of all levels that was behind the demise of Nortel.

It's true that Mike Z was the final CEO to lead Nortel into chapter 11 but the truth will ultimately come out in that he did not get cooperation from the leaders below him for they knew that their positions would have been threatened along the way for what was to be an inevitable restructuring needed to save Nortel.

The mangement style at Nortel was such a cancer that it continued to deteriorated the company right after the tech crash of 2001.

It has unfortunately for me and many others become all too clear in that Mike Z was not able to make the changes that were really needed because of the uncooperative levels of management beneath him,well run companies have management that work together at all levels, they are all on the “same page” but with Nortel it was self serving interests from management that took presidence above anything else.

I say this not because of what I have read on this blog,but because of the fact that Nortel ended up where it is today,a weaker economy is not supposed to send a company into chapter 11 as Mike Z has used as “the excuse” for filing into bankruptcy protection.

I have directed alot of my frustration towards Mike Zafirovski for ultimately failing to turn Nortel around,but I believe there were many options that he could have taken while he had the chance but in the end he did not get the all important cooperation from various management levels needed in order to facilitate any kind of major restructuring that would have made the difference between surviving instead of being liquidated.

I don't think it's coincidence that there wasn't any major overhaul during the three years that Mike was CEO,not to mention that his intentions from the very beginning were very ambitious unlike the way he seemed to turn his back on Nortel in the end when he gave up restructuring under bankruptcy protection.

You are absolutely correct sir.

I am not sure when it started but this is definitely the case in the last year. Directors were making deal to save themselves.I know one director who only contribution to the group was colorful powerpoint and laying off people even when there was not enough people to do the work. He was rewarded with a newly created Customer Watch role until somebody picks him up after the sale. This guy actually graduated from the fame Nortel Operation leadership program

E/// is going to find that its recent acquisition is LOADED with management where managers, directors and VPs — many not knowing anything about wireless — flocked to ensure they were “in scope” for CDMA, thinking it NSN would be the purchaser.

The “in scope” E/// transfers are a “who's who” of underperforming managers and “leaders” of various chartware programs, L6S teams and phantom roles. While management overhead should comprise only 3-5% a team's budget, the E/// deal is probably closer to 20-25%. E/// will realize this soon enough.

Bill Dunn and the theatrics sweeped under the rug like inhibiting publishing suicides is what killed Nortel. Delays, revisions, etc., what don't we know.

What we do know is that the fraud killed Nortel, and in essence Nortel killed Nortel. Of course. Years later, did they expect unlimited funds from the taxpayer with all sins forgiven no matter what lame plan they presented just to extend maintaining losing money and bonuses after one of the largest fraud settlements in the world?

The public sector /government had nothing to do with this private sector enterprise years later. They agreed with their own board in that it was not fixable amid endless contingency plans full of holes, and after already printing so many billions of Nortel paper with their business in ongoing decline, right up until their CDMA (80-90% of EBT nosedived in favor of GSM and emerging Long Term Evolutionary technologies). They were already extended profoundly enormous liberties just to survive another day in hope.

In all fairness, and in retrospect, hindsight is easy isn't it. Yet, I feel no one could have repaired Nortel after the mega-fraud rally and later downplayed revisions that doubled, deferring revenues, extending repair until SEC monitored, etc…

The braver decisions to preferred convention were thwarted at every turn every turn, perhaps as early as the departed and slandered Gary. Their ethical conduct worsened in despair, transparency, false optimism was never as atrocious after the fraud to even further detract from restoring any confidence.

They made themselves look like a bunch of keystone juniors in these supposedly hard to fill roles by a green team risking careers. A comedy of prfound errors ever since, Murphy's Law in full bloom.

Before the fraud they were announcing large orders left right and center, with Orange, Verizon, etc., and by the time BSNL, BT, Putian, WimMax to LTE , etc., hit the fan it was already too late. Especially CDMA decline that accounted for almost all of their profits while already losing money as an aggregate.

From 2003 to 2004 the stock doubled in a matter of months. They were seemingly on the road to recovery as a player. However, the exposure of lies and no profit (the most common motivator to this type of crime, bonuses) changed all that. It was only a matter of time it wound up like Enron, even with those not at the crime scene defending and acting just like those who were, with so many still there, as fraud trials loom.

Yes, Nortel killed Nortel… but more crassly and to the point the largest fraud in Canada killed Nortel, loss of orders, assisted by printing billions in Nortel paper that cost them nothing as they even kept the fraud bonuses and paid more to this day, to the point she just couldn't take it any more Scotty and and blowed up real fine. What a mess, bankrupty, delisted, and liquidating, it was inevitable wasn't it. What could they have done? Sold CDMA earlier? Imagine how that would have hit them back then, selling all of their profits. Could they have afforded severances? Doomed.

In retrospect and in all fairness again, they may have saved it going smaller sooner but their choices were unknown at the time and certainly limited. With what limited choices they did have, and so much lost after the largest fraud settlement in Canadian history, even saving it earlier may be questionable.

The extending of repair while desperately downplaying revisions for even following periods with so many still there, the endless 3 to 5 year turn around and hype, $20 buying opportunities, maintaining tax credits to beef worth on books they sought to clean so long, profoundly astounding bonuses throughout and thereafter, cutting severances in favor of big business creditors, etc…it seemed too obvious that tyranny was being supported, it was endless… even a forced government inquiry did too little…

Nortel further detracted from credibility after the largest fraud in Canada by those not at the crime scene acting just like the ever so few fall guys for this level of mass orchestration who departed. So what don't we know is what I question.

Big business trying to save it self through the benefit of the doubt and safe harbor, extending repair, hype, hiring high profile people, enormous legal power to rewrite the laws of physics, extending enormous liberties They had their chance to make braver choices than milk bonuses as long as long as they could.

I feel the fraud killed Nortel, the largest fraud in Canada and certainly on of the largest frauds on earth. Perhaps we will hear more of this with the pending fraud trials on both sides of the border. The fraud that killed Nortel, where… ya, Nortel killed Nortel. The fraud started the fire and the following revisions restating a restated restatement provided the catalyst to inevitable doom. They could not make money following this.

Funny how money remained and remains the ultimate everything to everyone from lying about it, to printing it, to paying it in bonuses, to not having enough of it to fold…

I likes …

Well, i don't think we went to the same business school. Your contention is that a margin of 20-25%.. but you don't say if that is before or after taxes, depreciation etc, will pay the $1.13B (plus incurred interest) in 6 years on a dwindling business. Believe it or not, the cost of supporting an acquired technology is often hiring than the orgainically grown technology. And you have vultures like Huawei giving away CDMA to secure their foot hold in the carrier transition to 4G. And that further errodes price point. So don't think for a NY min that pricing will stay as you know it.

I expect ericcson put a bet down on the fact that they won't every really be profitable on this business, but they are essentially guarenteed a prime vendor spot in Sprint and Verizon for 4G.

Agreed. I would say the same for all of them.

Who did what or who killed what really means nothing at this stage.
It's over. One thing however is for certain.
As much as we've come to blame the Board, Executives, Managers, Scandals, ineptitude, favouritism, cut-throat competition etc. the fact remains the Federak and Provincial Governments walked away from what was Canadas biggest telecommunications company without a second thought. It was one of a kind and when they knew the inevitable of where we are today was coming they did absolutely nothing. What makes this even more appalling is an actual high ranking politician sat on the Board collecting his big paycheques and he did absolutely nothing for YEARS. Talking about John Manley. He surely saw the writing on the wall and the quarter after quarter troubles coupled with layoffs that never ended but Mister Manley did absolutely nothing. He had the power to get the government involved and work to save, promote and assist the company of which he himself was a director. What he did not do and the inaction of the government at all three levels, was as big a crime as what Dunn did. That much is for certain. Time for a new topic. What's done is done. I would say what the Canadian Government Did to Nortel would be like the americans walking away from NASA. It really is an accurate analogy.

The Toronto Star is the paper for new immigrants and left-wing whiners, who use it
as a soapbox to demand their “share” of the Promised Land that
is the Canadian Welfare State.

I won't line my birdcage with it.

MC

I think Manley was only appointed in the hope that his political connections would be cashed when needed, but he was too stupid, naive, and impressed by the appointment to provide any help. He was “Industry Minister”, but as a lawyer for decades knew about as much about the business world as the guy who cuts my lawn – a politician thrown into a portfolio he had no clue about.

The culture in Nortel is to blame. These managemnet types from the very beginning are after MONEY. They blow a lot of hot air and step-on deserving peers using intimidation down and ass-kissing up to climb the ladder. Once they get to the position where they can exploit company resources, they waste no time as they feel entitled to do so after the personal struggles and battles they have fought in getting to the position they are at. Then begins a game of deception and acting to hide the facts and loot the company. Their VALUES are not strong enough to withstand the temptation of quick MONEY. They don't know and don't want to know anything otherwise as they keep their eye on the ball all the time as they know they have only a short span at the position to make the most of it. This is what I have seen as the main reason for Nortel's demise.

I worked for said Director,,,, I never thought his colourful powerpoints were colour full enough…hell he couldn't do that right…

How bout the VP with 4 people working for him….WTF? and still around?

One minor correction: “CEO's killed Nortel” I wish these guys sleep well in the rest of their lives.

As proud as I am to be Canadian, one of our weaknesses is that our country is a haven for white collar crime.

If you look at Enron, the only charge they could stick on Ken Lay was misleading the financial markets (and he did that more out of ignorance than malicious intent). John Roth did the EXACT same thing in the famous revision to his market-calming conference call, and nothing happened. He now lives in his compound north of Toronto and his millions in the bank. I would be surprised if Dunn does any jail time too. As for the more recent management, they're predominantly American and will have no consequences of their actions.

As a side note, why do you think Conrad Black was so eager to try and re-claim his Canadian citizenship when the Feds laid charges on him?

I really wish to see whoever brings down the Nortel is punished by law and justice, a crime investigation and / or civil probe needs to be launched as soon as possible.

This is for all unfairly treated Nortel employees, all pensioners, all shareholderes, all other stakeholders. And this is where the Canadian/US government need to step in.

All previous Nortel CEOs, all Nortel BOD members, and high rank execs need to face the court inqueries at least.

If you think about it, what plagued Nortel is what has plagued so much of corporate America for the last 20+ years. The inspirational system of entrepreneurial capitalism has been replaced with crony capitalism. The people at the top of the corporate food chain work to line their own pockets and make each other rich.

you are absolutely correct except that they don't really make each other rich,it's just that the top dogs are in a position to pillage and loot the companies along with their other top associates.

They all know that they are in a privileged position and don't usually stoop so low as to rat on each other under normal circumstances…but if it came down to them being investigated for whatever reason,it wouldn't be long before they would all be pointing the finger at each other when under the spotlight.

Humans like to think that they are intelligent,but just like monkies they are predictable…just throw them a banana and see what happens.