Nortel to remain as sponsor of Vancouver Games

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Nortel to remain as sponsor of Vancouver Games

DAVID EBNER

From Thursday's Globe and Mail

January 14, 2009 at 9:00 PM EST

VANCOUVER — Nortel Networks Corp. may be fending off its creditors under court protection, but its once proud name will still be prominent as a sponsor of the 2010 Winter Olympics in Vancouver.

The company, as a third-tier sponsor, has a comparatively small role as a “supplier” of gear to carry all the voice, video and data traffic for the Games, worth an estimated $15-million.

It has already delivered on most of its commitment, and the final pieces will be in place by May, Nortel told the Vancouver Organizing Committee Wednesday.

With its commitment fulfilled, Nortel retains full rights to use the Olympic brand to promote its name and gets access to tickets to major events and good hotel rooms.

Nortel's financial woes, however, may tarnish the Olympic brand, said Lindsay Meredith, a marketing professor at Simon Fraser University in Burnaby, a Vancouver suburb.

“Whenever you get into sponsorships, it's a marriage. It's the old-fashioned thing: You don't want to marry down. Your reputation is affected by the partner you're married to,” Prof. Meredith said Wednesday.

“But it's not like VANOC signed up a whole pile of iffy partners. Even though Nortel wasn't the biggest shining star in the galaxy, it was still a reputable organization. We can't accuse VANOC of exercising bad judgment. The market went down and everyone's on the ride.”

The Olympic Games were part of Nortel's push to rehabilitate the company under Mike Zafirovski's tenure as chief executive officer. Nortel became a sponsor for the Vancouver event in mid-2007 and a year later made a bigger bet on the 2012 Summer Games in London when it committed to a “tier-one” sponsorship and promised about $70-million in network equipment.

Sebastian Coe, chairman of the London 2012 organizing group, called Nortel a “world-class partner” when the sponsorship was announced in July.

For Nortel, the Games are an opportunity to showcase itself, even as its financial future is hashed out in court.

“This is really one of the better things we've got going, it's a really interesting way for Nortel to tell its story, what we can provide our customers,” Dave Johnson, general manager of Nortel's Olympics programs, said in an interview with The Globe and Mail last month.

On Wednesday, organizers for the Olympics in London said in a statement they are “working through [the situation] with Nortel.”

Bell Canada, the lead sponsor of Vancouver's Winter Games at $200-million, is part of the reason Nortel is involved. Nortel is the main equipment supplier for Bell, which is designing and running the network for the Vancouver event.

“Nortel has reassured us that their day-to-day operations will continue without interruption,” Bell spokesman Mark Langton said.

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