The cuts, which will affect 3,900 individuals, were described by Nortel's chief executive,, as "tough but necessary." They are part of Zafirovski's wider " ," with which he aims to cut $1.5 billion in costs by 2008. Along with the staff cuts, Nortel will reduce its from 17 percent to 15 percent of revenue.
Following the cuts, which are scheduled to take place through 2007 and 2008, Nortel will employ just one-third the number of workers it had after the dot-com boom in 2000. Revenue had already shrunk by two-thirds between 2000 and 2005.
Nortel is facing, some of which are merging (as did ), and some of which are new rivals. Most of the latter are low-cost suppliers from several Asian countries, including China.
Alcatel-Lucent said on Friday it would revise upwards its previously announced job cuts from 9,000 to 12,500.
Richard Thurston of ZDNet UK reported from London.