How the mighty have fallen. Nortel was once Northern Telecom, aka Northern Electric, the equipment supplier of Bell Canada in earlier days, the Canadian equivalent of what Western Electric was to the U.S. Bell System.
***** Moderator's Note *****
It's a sad day, to be sure. The "old world" wireline monopolies could afford the best, and they were willing to pay for it, because it meant less maintenance, more reliability, and a lot less training required for the union work force (1). They got what they paid for; gold-plated reliability that is, to this day, the standard for all the world: the United States and Canada are the only places I've ever been where customers pick up a telephone and dial a call without bothering to listen for a dial tone.
N.E.T. once conducted an experiment: it installed a switch made by a third vendor in a Boston-area location, to evaluate the cost/performance ratio. The exchange was plagued with problems throughout its lifetime, with everyone involved pointing fingers at everyone else. Although the executives liked having a third name they could drop during negotiations with Western Electric and Nortel, the citizens who used the exchange were much less enthusiastic, and eventually preasure from the PUC forced the transition to a Nortel remote.
Suffice to say that the Baby Bells learned the hard way that the Frying Pan you know is better than the Fire you don't: they stuck with the Weco/Nortel duopoly thereafter. All would have been fine, except for Nicholas Negroponte and his prophecy about the crossover of wire and wireless.
Cellular penetration continues to erode the wireline customer base, and cellular carriers contine to rake it in with bundles that include long distance (it's cheaper to include it rather than bill for it), while wireline competitors creek along with antiquated billing systems, an expensive work force (cellular is pretty much all non-union), and "big iron" exchanges that cost millions but can't attract customers who have other choices.
Bill Horne Temporary Moderator
1.) There is, of course, the sleight-of-hand game which AT&T played to maximize profits, pre-1984. Prior to the breakup, when AT&T owned the Bell System, Western Electric was a major profit center which could, given the margin-of-return regulatory environments AT&T's subsidiaries worked in, charge pretty much whatever it wanted for its switches. AT&T would enjoy the profits from Weco, while the operating companies told regulators they had no choice. That's another story, for another time: suffice to say that Nortel had 20+ years to deal with the change, and the company didn't keep up.
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