Bankruptcy, just like divorce, is a messy course. Who gets the kids, who gets the house, the RRSP … quick, let’s split everything up and hope that at the end of the day, we’re all happy. Then, nobody ends up content at the end of the line. It’s a zero sum game with losers all around.
What on earth was Nortel thinking when they went down this path ? It was over six months ago that Nortel filed for bankruptcy protection proclaiming that it’s “business as usual”. The fact is, once you head down this course, it will never be the same.
So many counterparts I spoke with suggested that Nortel would emerge a healthier and stronger company. How could that happen? Their employee relations were a mess, the products were suffering, and senior management was in complete denial. In fighting continues to stymie the bankruptcy process, and the vultures are hanging around looking for the small pieces of flesh to fly away with.
Now you’ve got to wonder, what exactly do these people /companies think they’re going to feast on ?
Matlin Patterson is going after the bits, further staking their interest by hiring ex-Nortel executive Dion Joannou to spearhead their bid for the remaining pieces. AllAboutNortel.com has an interesting posting on that. Nokia Siemens is going after the CDMA business, hoping to pick up the pieces for a really low price. It’s expected that they’ll re-coup their investment in less then a year – IF their assumptions are correct.
If the pieces were so good, wouldn’t you expect to see more vultures swooning in to pick some up ? But, they’re not. Maybe upon further investigation the other potential bidders realize they’re bidding on spoiled meat.
In the tech world you are as good as your last product, and in NortelLand, six months of chocked innovation (or maybe even longer) is a long time to be without a hit product. I suspect the other potential bidders are now realizing that all of the infighting, poor management, lack of product innovation, poor business decisions, and corporate greed are making the meal look awfully unappetizing.
Would somebody please pass the salt !
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How can one have a “zero sum game with losers all around”? Surely a zero-sum game is one where the value lost by some players is exactly matched by the value gained by other players. A game with losers all around would be a negative sum game wouldn’t it?
Have I missed something subtle here?
It seems like the “zero sum game” comment I made should have been referenced more to the bankruptcy / divorce. True, a zero sum game would imply that both parties net out with “ZERO”, and true, you can’t have a loser in a zero sum game. Divorce is a “zero sum game”. That’s really what I was trying to suggest. And in divorce, nobody wins (really, both parties lose). But then it wouldn’t be a zero sum game ! I guess we’re getting side tracked into a philiosopical discussion though. It’s a nice break from telecom.