Nortel today declared chapter 11 bankruptcy for its US and Canadian operations (follow the story over on NoJitter.com). Nortel has been around for over 110 years, transforming itself many times over the years. In the last two years, at least on the enterprise side, Nortel has focused on competing with the likes of Cisco as an end-to-end voice & data systems vendor, while differentiating itself via a deep partnership with Microsoft's UC offerings and a growing partnership with IBM Lotus. More recently Nortel has introduced initiatives in virtual worlds applications and communications-enabled business process platforms.
Nortel's troubles reflect the growing reality of the "old world" business market intruding into the "new world" of social networking, web 2.0, and unified communications. All these new ways of communicating and collaborating are nice, but if at the end of the day they don't generate profits, then where did they get us? I fear we're going to see the loss of a lot of great ideas over the next year, and perhaps a reduction in innovation as organizations retrench. But it is important to remember that retrenchment by mainstream organizations is likely to create opportunities for nimble startups able to exploit opportunities, and able to demonstrate a viable business model.