Last One Out Turn Off The Lights

Nortel has been shedding jobs for over a decade as it lost money every year since the dot com bubble burst. But of course the guy at the top responsible for Nortel's losses keeps his job. Whle advocating layoffs and concessions as the solution to Nortels problems. Unfortunately that has been tried for a decade and it ain't worked.

Nortel has now lost more than $4.5 billion since Chief Executive Officer Mike Zafirovski took over at the end of 2005, pushing him to cut 18 percent of the workforce. Today he said he plans further reorganization aimed at saving as much as $400 million next year, freezing travel, ending salary increases and getting rid of at least four top executives.

The more than 32,000 people who work for shrunken telecom giant Nortel, its investors who have seen share value plunge from $20 to pennies in a year, and analysts following the firm awoke Monday expecting a financial tsunami of an announcement.What they got as Nortel announced a $3 billion red ink bath for the third quarter was a series of announcements that might slosh water out of a nearly full bathtub.Did a reorganization plan accompanied by some job trims and the booting of some top executives save the S.S. Nortel, or did management just reshuffle deckchairs on what many analysts are growing to believe is a business Titanic?

Deregulation and the optical boom
In 1983, due to deregulation, Bell Canada Enterprises (later shortened to BCE) was formed as the parent company to Bell Canada and Northern Telecom. Bell-Northern Research was jointly owned 50-50 by Bell Canada and Northern Telecom. The combined three companies were referred to as the tricorporate.[5][6][7]
As Nortel, the streamlined identity it adopted for its 100-year anniversary in 1995, the company set out to dominate the burgeoning global market for public and private networks.
In 1998, with the acquisition of Bay Networks, the company's name was changed to Nortel Networks to emphasize its ability to provide complete solutions for multiprotocol, multiservice, global networking over the Internet and other communications networks. As a consequence of the stock transaction used to purchase Bay Networks, BCE ceased to be the majority shareholder of Nortel. In 2000, BCE spun-out Nortel, distributing its holdings of Nortel to its shareholders. Bell-Northern Research was gradually absorbed into Nortel, as it first acquired a majority share in BNR, and eventually acquired the entire company.

After the Internet bubble

Nortel Networks Corp (NYSE: NT) stock price (source: ZenoBank.com)
In the late 1990s, stock market speculators, hoping that Nortel would reap increasingly lucrative profits from the sale of fibre optic network gear, began pushing up the price of the company's shares to unheard-of levels despite the company's repeated failure to turn a profit. Under the leadership of CEO John Roth, sales of optical equipment had been robust in the late 1990s, but the market was soon saturated. When the speculative telecom bubble of the late 1990s reached its pinnacle, Nortel was to become one of the most spectacular casualties.
At its height, Nortel accounted for more than a third of the total valuation of all the companies listed on the Toronto Stock Exchange (TSX). Nortel's market capitalization fell from C$398 billion in September 2000 to less than $5 billion in August 2002. Nortel's stock price plunged from C$124 to $0.47. When Nortel's stock crashed, it took with it a wide swath of Canadian investors and pension funds, and left 60,000 Nortel employees unemployed.
CEO John Roth retired under controversy to be succeeded by former CFO Frank Dunn. Despite some initial perceived success in turning the company around, he was fired for cause in 2004 after being accused of financial mismanagement. Dunn and other former Nortel officers have been accused of engaging in accounting fraud by the SEC (for more information, refer to "Accounting scandal").[8]
Retired United States Admiral Bill Owens was hired as the CEO to replace Dunn. In late 2004, Nortel Networks returned to using the Nortel name for branding purposes only (the official company name was not changed).
Nortel acquired PEC Solutions in June, 2005, renaming it Nortel Government Solutions Incorporated or NGS. The wholly-owned subsidiary provides information technology and telecommunications services to a variety of government agencies and departments.[9]
On August 17, 2005, LG Electronics and Nortel signed an agreement to form a joint venture to offer telecom and networking solutions in the wireline, optical, wireless and enterprise areas for South Korean and global customers. Nortel owns 50 percent plus one share in the joint venture.

Here are some key dates in the company's history:
May 1, 2000 - BCE Inc (BCE.TO: Quote, Profile, Research, Stock Buzz), Canada's biggest telecommunications group, completes spinoff to shareholders of 35 percent stake in Nortel, worth about C$88.5 billion ($75.6 billion)
Feb. 15, 2001 - Nortel cuts 2001 earnings and sales forecast in half, blaming severe erosion in U.S. economic conditions. The warning triggers a 33 percent drop in its stock and brings class-action lawsuits.
May 29, 2002 - Nortel plans to cut 3,500 jobs and sell more assets as it pares its revenue forecast.
June 4 - Nortel shares collapse to decade-long lows on concerns a new financing will further dilute its stock. Cash-hungry Nortel raises $1.49 billion June 7.
Oct. 23, 2003 - Nortel reports a quarterly profit, but says it will restate results going back to 2000.
March 15, 2004 - Nortel says it will likely restate results for a second time and delay filing its annual report.
April 5 - The U.S. Securities and Exchange Commission launches a formal investigation into Nortel's accounting
June 29 - Nortel exits manufacturing business, sells plants to Flextronics International, transfers 2,500 staff.
Sept. 30 - Nortel cuts almost 10 percent of its staff, 3,250 jobs, and vacates offices worldwide.
Jan. 11, 2005 - Nortel restates its results and says 12 senior executives will repay $8.6 million of bonuses.
Oct. 17 - Motorola's No. 2 executive, Mike Zafirovski, is appointed CEO, promising renewed growth and focus.
Feb. 8, 2006 - Nortel says it will pay $2.47 billion to settle two class-action suits from its accounting scandal.
Feb. 7, 2007 - Nortel slashes 3,900 jobs and shifts 1,000 positions to lower-cost locations such as China and India.

Oct. 15 - Nortel pays $35 million to settle civil charges filed by the SEC related to its accounting scandal.
Feb. 27, 2008 - Nortel says it will cut 2,1000 jobs as it faces persistently slow demand for its products.
Sept. 17, 2008 - Nortel cuts revenue forecast, plans another round of restructuring and the sale of its Metro Ethernet Networks business. It says it may also look for a partner to develop fourth-generation wireless technology.
Nov. 10 - Nortel announces 1,300 layoffs, a freeze on salary increases and a review of its real-estate portfolio after posting a $3.4 billion quarterly loss.

SEE:

Nortels Chickens Roost

NORTEL: Canada's Enron

Nortel Slash & Burn

NORTEL: REDUX

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Appropriately Named

An appropriate name and appellation for a fund manager;
Ontario Teachers' Wants to Keep BCE Executives, Leech Says

See:

Monopoly Capitalism in Cyberspace

Telus

BCE

CRTC

Bernier

P3

AIM High

Your Pension Dollars At Work

P3= Public Pension Partnerships

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Government, CRTC, Maxime Bernier, Industry Minister, Telus, Bell, Shaw, Rodgers, BCE, CTV, GlobeandMail, Conservatives, deregulation, VOIP, cellphones, telcos, Canada, telephones, communications, monopoly, telcom, wireless, internet, consumers, politics, Alberta, Heritage Trust Fund, LAPP, Alberta Investment Management Corporation, Canada, Pensions, P3, public-private-partnerships, OMERS, CPP, Ontario-Teachers-Fund, OTF, Canada, investment, infrastructure, VenCap, shareholders, economics,

Belus?

That's what the Globe and Mail is calling the idea of the merger between Telus and Bell (BCE).

In this latest poll you find that those of us who have experienced Telus are opposed to the merger for the reasons I have given here and here.

The Angus Reid poll found that 48 per cent of Canadians believe the government shouldn't permit a merger between Vancouver-based Telus and Montreal-based BCE. Another 27 per cent supported it, while 25 per cent weren't sure.

The highest levels of opposition to such a deal came from British Columbia and Alberta at 57 per cent and 61 per cent, respectively. "What surprised us the most is the high level of skepticism from Alberta and B.C., where virtually everyone deals with Telus on a daily basis," Mr. Canseco said.

If such a merger were to go through, 62 per cent of the poll's respondents didn't expect better customer service. Moreover, 68 per cent said it's somewhat or very likely wireless rates would increase, while 62 per cent said the same thing for Internet prices.

See:

Monopoly Capitalism in Cyberspace

Telus

BCE

CRTC

Bernier

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Government, CRTC, Maxime Bernier, Industry Minister, Telus, Bell, Shaw, Rodgers, BCE, CTV, GlobeandMail, Conservatives, deregulation, VOIP, cellphones, telcos, Canada, telephones, communications, monopoly, telcom, wireless, internet, consumers, politics,

Ding Dong Tories

Even if it meant protecting Canadians who elected them from being subjected to a communications monopoly, the likelihood that the privatizing Conservatives, whose love of big business is expressed my its Industry Minister , would do anything like interfere in the market well ferget about it. Canada telecoms merger up to regulators: Harper

A consumer advocate warned Thursday that a proposed $50-billion merger between Bell Canada Inc. and Telus Corp. would be a loser for customers of the two telecom giants.

"The government and the regulators should simply turn down this merger," said Charles Tanguay, communications manager for Quebec's Union des Consommateurs. "This is critical because it would weaken competition in both the traditional wireline and wireless markets and expose consumers to continuing high prices and second-rate services."

Canadian consumers already pay almost twice the average per-minute charged in the U.S. and Europe and the market has too few players, Tanguay noted.

"A monopoly would be worse than today's duopoly, influence regulated markets unduly and freeze out new entrants."

See:

Monopoly Capitalism in Cyberspace

Telus

BCE

CRTC

Bernier

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Government, CRTC, Maxime Bernier, Industry Minister, Telus, Bell, Shaw, Rodgers, BCE, CTV, GlobeandMail, Conservatives, deregulation, VOIP, cellphones, telcos, Canada, telephones, communications, monopoly, telcom, wireless, internet, consumers, politics,

How Do You Spell Monopoly

T E L U S. The former publicly owned phone company of the Province of Alberta was created because Bell Canada would not expand into Alberta at the beginning of last century.

The Edmonton Phone Company. EdTel, was formed because neither Alberta Government Telephones, AGT, nor Bell Canada would provide services to Edmonton. Over a decade ago it was sold off at a fire sale price by the city to its old nemesis the predatory AGT now privatized and called TELUS.

It was announced that the privatized Telus, which now includes Ed Tel as well as B.C. Tel, is preparing a take over bid of Bell Canada; BCE. How the wheel turns.

All this privatization of public enterprises was to end their 'state monopoly' and create 'competition'. So instead it creates privatized monopoly and reduces competition.

We are so much better off now. Except we sold the farm and now we buy back our milk and eggs.

See:

Monopoly Capitalism in Cyberspace

Telus

BCE

CRTC

Bernier

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Government, CRTC, Maxime Bernier, Industry Minister, Telus, Bell, Shaw, Rodgers, BCE, CTV, GlobeandMail, Conservatives, deregulation, VOIP, cellphones, telcos, Canada, telephones, communications, monopoly, telcom, wireless, internet, consumers, politics,