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See What People Are Saying About... Nortel Bankruptcy

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Nortel Networks , North America's biggest telephone equipment maker, filed for bankruptcy on Wednesday, hoping to save a once high-flying business whose decade-long decline has accelerated with the global economic crisis.

Before the stock market opened on Wednesday, Nortel said it and a number of its affiliates filed for Chapter 11 bankruptcy protection in the United States. It has also filed for protection in Canada and some of its European subsidiaries are expected to make similar filings.

"Based on this filing, the board of directors must believe that not only is the fourth quarter bad, but that the first quarter is going to be just as bad or worse," said Duncan Stewart, an analyst at DSAM Consulting in Toronto.

The filing marks a crucial stage in the slow deterioration of one Canada's most prominent companies. Nortel, a stock market darling before the tech bubble burst at the start of the decade and still one of the country's largest employers, has struggled for years in an industry that has changed radically since its heyday in the late 1990s.

A sharp slowdown in many of Nortel's major markets, especially the United States, has exacerbated its problems, leading the company to warn last month that its business was under increased pressure and its cash position and liquidity were deteriorating.

Telecom companies have scaled back spending on the equipment that Nortel makes in a bid to clamp down on costs amid the global downturn. At the same time, the company has faced intense competition from North American and European rivals such as Alcatel-Lucent and Ericsson, as well as low-cost Asian vendors such as Huawei Technologies.

And that leads to our Fast Money Reader Poll. Over the next 12 to 18 months what's your view on the telecom sector?

CNBC.com with wires