The Bigger They Are, The Harder The Crash

Canada's very own titan of communications, our princely first-place in our (century-old)home-grown telecommunications industry, has appeared, finally, to succumb under the weight of its final inability to resuscitate its fortunes. Nortel was Canada's largest private-sector research and development entity, with pride of place in the chronicles of Canadian business success stories.

At its triumphant height through the technology boom of late 1990, Nortel's value was placed at more than $350-billion, accounting for two-thirds of the value of the Toronto Stock Exchange. At the present time, its stock price is a pitiful 12 cents. The New York Stock Exchange was prepared to delist it as its stock price descended to junk status.

It has taken eight years of struggle after falling from the luminous grace of first place, for Nortel Networks to file for protection from its creditors, in Canada and the United States. The crown jewel of Canadian enterprise, expertise and success was beset with allegations of accounting malfeasance, regulatory probes. Its faltering financial state led to deep cuts to its hallowed research and development.

From a company that once employed 32,000 workers, secure in its place in the world of high-tech and the latest in communications advances, it was humbled to one that desperately sought to restructure itself, laying off thousands of workers in one hopeless wave of 'adjustments' after another. Simply put, orders kept dwindling after the tech meltdown, and Nortel shed jobs and bled income.

Nortel, struggling to lift itself out of its bookkeeping scandals and steadily declining sales, began to lose out as well to its competitors in an industry that advances its technologies at lightning speed. Now it attempts to sell off parts of its business enterprise, and in the current climate of financial collapse there are few offers to be had.

Help forthcoming from governments? Well, government bailout for the auto industry is one thing; a helping hand to an industry where Canadian-based expertise and initiative and design capabilities set it afire on the world stage, and aside from most other industries, that's another thing altogether.

On the other hand, a declaration of bankruptcy protection has happened before and culminated in large corporations being successful in rescuing themselves from collapse. This is not the end of the story.

Nortel may yet present as another phoenix rising from the ashes of its prematurely presumptive funeral pyre.