To: All Canadian Politicians, Media and Chattering Classes
Subject: Please Shut The F--k Up About The Nortel-Ericsson Deal
Dear Frothing At The Mouth Protectionists,
Please note the following reasons you should shut up now about the Nortel - Ericsson sale and let Ericsson get on with saving what's left of Nortel's Carrier Networks business.
- If Nortel was a viable business under Canadian control, we wouldn't be here.
- If Nortel was a viable standalone business under anybody's control, see (1).
- The wireless equipment industry is now a mature industry. Consolidation is inevitable and companies that don't have sufficient market share or long term viability must either merge or die.
- If you kill the Ericsson deal, well, see point 3.
- Nortel's biggest customer is Verizon. Verizon/Vodaphone is the market leader in planning and deploying LTE. They chose Ericsson as one of their leading LTE vendors. Ericsson-Nortel makes a hell of a lot more sense than any other possible Nortel marriage. Any other merger will only lose Verizon as a customer in the medium term and... see point (3).
- RIM only wants the patents and isn't about to get into the network gear business, see (3).
- Ericsson is the best hope for salvaging any Canadian jobs out of the whole mess.
Now, here's what you should be talking about, calling your MP about and protesting about.
- There are Canadians who are truly suffering as a result of this whole thing. They are the severed employees and pensioners of the bankrupt Nortel. You want to be patriotic? Do something for them.
- Nortel management took the company into bankruptcy protection with nearly $2bn in the bank, yet still chose not to pay severance to laid-off workers. In doing so, they not only screwed those individuals, they screwed all of you as taxpayers, because you've been paying EI to those folks to partially cover what Nortel owes.
- Nortel is in breach of labour legislation in every province in the country, because the CCRA trumps provincial labour laws.
- Current bankruptcy law places severed employees on the same level as the holders of Nortel junk bonds. The bond holders are sophisticated organizations who know the game - and who likely only paid 10c on the $ for what they now hold in the first place. The original debt holders have taken their haircut and are long gone. Employees can't hope to have a voice in the process or have their concerns met when competing with these bond holders. So the deal that comes out of the bankruptcy will inevitably be structured for the benefit of the bond holders and probably will further screw the employees.
- Companies losing money as a result of the bankruptcy get to write that off against future taxes. Oh, did we mention the taxpayer is getting screwed here as well? Employees don't get to do that.
- Nortel is moving cash out of the Canadian operation into other jurisdictions - and currently this means Canadian creditors will likely get about half what the US creditors will. Shouldn't our government be more concerned with stopping the shafting of Canadian creditors?
- There is something you can do: The government has the power to modify the Bankruptcy and Insolvency Act before Nortel enters liquidation, to ensure employees get treated fairly.
Become educated about this issue, and please visit http://tinyurl.com/ChangeCCAAPetition. You'd be doing yourself and all Canadians much more of a favour. Unless you'd rather spend your time putting a bunch more Nortel workers out of a job and getting shafted with the bill again.
Please do what you can to right the real wrongs of this situation. Corgis don't have opposable thumbs, so we're counting on you.
