Re: Nortel files for bankruptcy

[David Farber <dave () farber net>]

Begin forwarded message:

From:
Date: January 14, 2009 4:04:47 PM EST
To: <dave () farber net>

If you want to post this please remove any identifiers.

The situation is nearly the same at Alcatel-Lucent. In some respects  
it may
be even worse.  Lucatel has a even more distinguished history of failed
acquisitions the most spectacular disaster being Ascend. But as we all  
know
the French Govt will NEVER permit one of its "national champions" to go
under. Case in point the French bailout of the engineering firm Alstrom.

However what is obvious to most of the observers of the telecom  
industry is
that the real culprit for the situation at Nortel and AL is Huawei.  
Huawei
posted revenue gains of 28% in 2008 and has created huge price  
pressure in
the telecom supplier industry especially in access networks. They are  
a huge
competitive force everywhere but North America and in increasingly in
Internet Engineering circles.

It was a open secret that Huawei wanted to buy Nortel but was warned  
that
the US Government would refuse to do business with any network  
operator with
Huawei gear in their core network. The Huawei deal to acquire 3Com  
with Bain
Capital died specifically for that reason.





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