Nortel closes ex-CoreTek optical unit

Nortel Networks Corp. is shutting down the optical components business it acquired in March 2000 as CoreTek Inc.

The Boston-based division, which developed tunable lasers and other components for optical carrier networks, fell victim to the glut in carrier network capacity and the resulting slump in infrastructure building, said David Chamberlin, a spokesman for Nortel, on Thursday. As a result of the closure, Nortel will eliminate 160 jobs.

Nortel, in Brampton, Ontario, agreed to buy CoreTek in a deal worth up to US$1.43 billion in stock shortly before the April 2000 technology stock crash. The weakness of the IT and telecommunications industry since then has contributed to a string of losses and layoffs at Nortel. On Thursday, the company lowered for the second time its third-quarter revenue forecast.

Tunable lasers can save carriers money. In wavelength-division multiplexing systems, a single fiber can carry multiple wavelengths of light, each modulated by its own data signal. Tunable lasers are designed to reduce a high-cost requirement in current systems that use fixed-wavelength lasers: Carriers need to have one replacement laser on hand for each one in active use. A tunable back-up laser can substitute for any of a number of different lasers.

CoreTek developed advanced lasers that could be tuned to many different frequencies. Nortel used some CoreTek lasers in its own products and sold some to other equipment makers, but demand for big optical systems that require them was limited, Chamberlin said.

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