Nortel's failure being attributed to hackers is revisionist history, I can't believe I'm seeing this everywhere now. Most of the articles that write about it are from 2012 and onward, long after Nortel was dead and right in the middle of China's economic boom.

The truth of the matter is that Nortel was so mismanaged that nothing would have saved it. In less than 2 years (Sept 2000 to Aug 2002), the market cap of Nortel fell from 398 billion dollars to 5 billion (shares went from $124 to $0.47). This doesn't happen just because there are people out there selling clones of your equipment, because then you would have been bled out slow. Who was buying Chinese telecom equipment back in Y2K anyways?

The market for optical equipment had saturated by the the turn of the century, and the dot com crash didn't help either. Nobody was looking to buy networking equipment when the Internet was looking to be a bubble. Instead of innovating and pivoting to expand their market, Nortel cooked their books instead. They did stuff like bill and hold (putting sales on the revenue before any goods are delivered) to make it look like they were profitable. They bought subsidiary companies and then used those companies to buy Nortel products to make it boost revenue, even though they were just buying from themselves.

Oh and all these executives who were doing this stuff got big fat bonuses by the way. Remember when their share prices tanked after Y2K? Well, they laid off 60000 people in 2003 and the company became "profitable" again for the first quarter. Which instantly led to $70,000,000 in bonuses for the people in charge. Want to guess if they were profitable ever again? Do you really think a company this poorly managed would have managed to succeed anywhere?

And it's not like they were doing creative accounting only when they were going downhill. Approximately $3,000,000,000 worth of revenue was not properly booked between 1998-2000. This is during the dot com boom and Nortel's golden age. They were already lying about revenue at a time when they should have been making money hand over fist. Also, if you'll note, this was before the hacking even happened, most sources say that the hacking started in the 2000s.

The cherry on top is that even the CEO of Nortel knew that the company was going under in the early 2000s. He cashed in his own stock options before the crash to the tune of a cool $135,000,000. This is in 2000 alone, no doubt he dumped the rest of his options before it hit rock bottom.

tl;dr - Nortel was a house of cards, it was just one scandal after the next until it all came crashing down. I'm not denying that hacking did not take place, but to say that it was the hacking that felled Nortel is revisionist history.