It's capitalism that killed it. Stock price was sky high because of the optical-fiber hype. Management has to kill those traditional businesses (switches, etc) that doesn't have that high growth rate that justifies the stock price. Then optical hype was busted..
Also, who was supporting telecom in the old days? Bell Labs, AT&T, Lucent, etc? The government of course. Privatization happened and trade agreements with Europe meant the US and Canadian government can no longer support telcos and thus the downfall of all these companies at the time.. Even European ones like Alcatel, Nokia, Ericsson, Siemens. This allowed the Asian telcos, not only the Chinese ones, but Korean ones like Samsung to take over.. (Of course the Chinese government and Korean governments were and are still heavily involved in them).
Also, who was supporting telecom in the old days? Bell Labs, AT&T, Lucent, etc? The government of course. Privatization happened and trade agreements with Europe meant the US and Canadian government can no longer support telcos and thus the downfall of all these companies at the time.. Even European ones like Alcatel, Nokia, Ericsson, Siemens. This allowed the Asian telcos, not only the Chinese ones, but Korean ones like Samsung to take over.. (Of course the Chinese government and Korean governments were and are still heavily involved in them).