RoW Update

Nortel and Motorola to combine wireless equipment units, rumours abound
Rumours began spreading late last week that Nortel Networks Corp. and Motorola Inc. could be in talks to merge their respective wireless equipment units following a report of such a move in a Business Week article. Some observers are speculating that may be the case since there has been significantly lower demand from carriers for wireless infrastructure equipment.
An RBC Capital Markets report also indicates that Nortel may have to initiate another round of layoffs if it wants to reach profitability before the end of 2003. Analyst John Wilson said in a report: "Lowering the break-even level sufficiently to reach profitability again prior to the end of 2003 will, in our view, require an additional 10%-20% reduction in head count." That could translate into a further reduction of 5,000 to 10,000 employees.
Speculation of more consolidation within the industry has been a hot topic recently. Following a significant decrease in carrier spending, some believe that the large equipment makers, such as Nortel, Motorola and Lucent Technologies could unload those business units or merge them with another company. More details.

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NL Editorial

The opinions expressed in this editorial are those of the author and do not necessarily reflect those of Decima Reports.

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Regulatory reform next step in ensuring sustainable competition, Call-Net says

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NL People

Telecom Ottawa, the communications subsidiary of Hydro Ottawa, has appointed three senior managers. Lucie Adam signs on as director of network operations and technology. She most recently worked at Norigen Communications and has experience at Sprint Canada. The new director of engineering and field services is Claude Poithier, formerly of AT&T Canada, MetroNet, and Rogers. Vidéotron Télécom alumnus Jacques Taillefer is the director of sales and marketing.

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NL Short Takes

Group Telecom latest CLEC to form special committee
GT Group Telecom Inc. has formed a special committee and has hired Morgan Stanley & Co. Inc. to help the firm in considering possible capital structure enhancements. The move comes days after AT&T Canada formed a similar committee (NL Update, Mar. 18/02) and months after Call-Net Enterprises restructured (NL, July 16/00).

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Bank says telecom market outlook good, recovery ahead for manufacturers

A new bank study predicts that the next five years will be productive ones for the telecom industry, good news for an industry battered and bruised. The Bank of Montreal believes relief for the carrier market will come quickly, while equipment manufacturers will have to wait for the upturn in their fortunes.

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O.N. Telcom files review and vary over contribution levies for independent ILECs

The concern over CRTC decisions affecting small independent telcos continues as an Ontario company seeks to have the commission take another look at two decisions and rescind a subsequent order.

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Electrical wires may soon be delivering telephony services to Canadian customers

In their search to provide telecommunications services, utility companies may have found the "killer app" lying right under their noses. While most firms have been excited by the prospect of using their fibre and wireless networks to serve customers, a growing trend is the implementation of powerline telecommunications (PLT).

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Hoping for price cap relief, Call-Net moves into Ottawa residential market

The preliminary move into the competitive residential market has been so successful for one CLEC that it is now expanding into Ottawa. Sprint Canada will begin offering local and LD voice bundles to individuals at rates slightly below that of incumbent Bell Canada.

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Carriers must be alert to provisions of new anti-terrorist legislation, lawyer warns

The federal government’s omnibus legislation to fight terrorism has implications for the telecom sector that were little noted when the bill was passed last fall. Activities that have been considered part of normal customer service could end up being seen as abetting subversives.

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