The telecom crisis sweeping through the world has arrived in Israel. Global giants


(NYSE:NT) and

Lucent Technologies

(NYSE:LU) have decided to slash development centers and activity in Israel.

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Employees of Nortel's Armon Networks and Lucent's Wave Access have received notices that their activity no longer constitutes core business, and their services are no longer required.

Armon Networks was one of the first Israeli companies to be purchased by a global giant. It was acquired by Bay Networks in 1996 for $33 million. In August 98, Bay Networks was purchased by Canada-based Nortel. Armon was involved in developing probes, deployed on local area networks to collect information on network activity for purposes of quality of service control. The company employed 150 people at its peak, right after the merger with Bay Networks.

Armon started its downward spiral since the acquisition of Bay Networks by Nortel. Nortel was disappointed in general about buying Bay Networks. The cost of the take over was $10 billion. Bay's success in the switching business was limited. Armon employee roster also dwindled. In the division's final week, it had only 50 people on its payroll.

Yesterday Armon employees received a email notices to arrive at work at 9:00 AM sharp. No explanation was provided for the urgency. The next morning, when employees arrived, they were awaited by company security officers, told of their predicament and relieved of their company keys and badges.

Yesterday Lucent declared it is cutting 10,000 jobs and reevaluating its strategy. Lucent's local representatives said the layoffs would not affect Israeli operations. Not accurate, in retrospect: 150 employees of Wave Access, acquired by Lucent in 1999 for $70 million, were fired on the spot.