[LINK] "It's time for Nortel to find its own way"

[rfmcdonald]

Nortel, a Canadian telecommunications company that was a major success story for a century, has gone into bankruptcy protection. Nortel has been circling for years, ever since a 2001 accounting scandal revealed that the books were cooked. Once employing one hundred thousand people, it now employs only 36 thousand, including six thousand in Canada. It's unlikely that the government will bail them out--the attitude of Derek DeCloet in his article in The Globe and Mail probably sums up the consensus of Canadians.

It's the source of thousands of quality, high-paying jobs. It is still the biggest corporate spender on research and development in the country. The campus in Ottawa once known as Bell Northern Research - to locals, the Big Nerd Ranch - is still home to about 4,000 people, one of the biggest concentrations of smart minds in Canada.

If innovation is your yardstick, Nortel Networks is more important to the economy than the shrunken Ontario branch plants of General Motors and Chrysler that received a multibillion-dollar pledge of financial support from Ottawa and Queen's Park. Yet you don't see Industry Minister Tony Clement or Premier Dalton McGuinty circling Nortel with open chequebooks, and thank goodness for that.

A government bailout right now would be unlikely to accomplish much.

Nortel's descent into bankruptcy protection represents the inevitable denouement to a horrible eight years. Its repeated missteps - the artificial boosting of revenues through easy credit to customers; the post-bubble unravelling in 2001; the accounting scandals; the hiring of the ineffectual William Owens as a caretaker CEO; the never-ending restructuring schemes - so weakened the company that when the financial crisis hit, it couldn't withstand it.