Nortel Networks Corp. can be grateful for one thing -- the year's many spectacular financial collapses enabled its own rapid meltdown to mostly escape notice.

Once a premier maker of telecommunications equipment, Nortel saw its stock price plummet 96%, to penny-stock range, with the company now "on the brink of irrelevance," as one Wall Street analyst recently put it.

The Brampton, Ontario, company's woes are the result of a cardinal sin in technology: dithering. Success in this world, today more than ever, requires quick, decisive leadership, whether a company makes smarter phones or more cost-effective routers. The gravity of the sin is all the more serious for large, mature companies that misjudge or fall behind the development curve. Meanwhile, the global economic slowdown is pushing companies that were perched on the ledge into the void.

Such travails also highlight a dilemma common to many industries: Mature companies need to consolidate, but consolidation is difficult because of the characteristics -- slowing growth, commodity pricing, swelling costs -- present in older industries.

For companies like Nortel caught in the squeeze, it may be too late. Despite having its equipment installed at nearly every major telecom services provider, the company failed to act quickly enough as customers began moving from legacy networks to next-generation Internet protocol networks. Now other companies that reinvented themselves to capitalize on this trend, such as Cisco Systems Inc. and Juniper Networks Inc., are leaving Nortel behind, says Yankee Group Research Inc. analyst Zeus Kerravala.

"Nortel simply took its eye off the enterprise ball," he says. "It's been playing catch-up and living off of its installed base for years."

Kerravala likens the fall of what was once a multbillion-dollar market capitalization tech stalwart to the end of the mainframe era. Names like Honeywell International Inc. and Univac a few decades ago seemed destined to remain leaders in the computing world, but then the mainframe became less relevant with the advent of client-server and Windows-based systems.

Regardless of the sector, an iron law governs mature tech players: Change or die. Take makers of dynamic random access memory chips, which store data in PCs and pretty much every other electronic device. For these companies, the future is clear, and more akin to a brick wall than a hazy horizon. In the notoriously cyclical DRAM industry, cranking out high volumes of these commodity-like chips is the only way to eke out any profit.

Like telecom gear manufacturers, memory chipmakers face a major technology shift that poses problems magnified by the bleak economy.

The industry is moving from producing DRAM chips on 200 millimeter wafers to 300 millimeters. The move can cut manufacturers' costs by 30%, but there's a catch: 300-millimeter fabrication plants cost roughly $2.5 billion to build, and, with the state of oversupply in the DRAM industry and the poor overall economy, that kind of cash or financing is difficult to come by.

"Here we are in a market whose product is selling at cost, and the cost is determined by the guys with 300-millimeter fabs," says Jim Handy, an analyst with research firm Objective Analysis. "The 200-millimeter guys are losing money all over the place."

In other words, success or failure in the chip world, as in other mature tech sectors, is measured by the centimeter. And such tech shifts resonate worldwide. "Buyers are thinking, 'No one knows how bad this will get,' while sellers are looking at where they were a quarter or two ago," says Jevan Anderson, a managing director of M&A with RBC Capital Markets.

In mature industries, even when consolidation makes all the sense in the world, even when the most stringent cuts to operating expenses are insufficient to maintain profitability, combining companies can be all but impossible. The electronic design automation industry, which develops software that aids engineers in designing and verifying chip blueprints, offers a case in point.

Cadence Designs Systems Inc. in June offered $1.6 billion for rival Mentor Graphics Corp. in a deal that would have married the top player in the industry with the No. 3 company.

If the pair had reached an agreement, the deal would have created an opportunity to cut costs, pool their R&D team and create a far broader product set for customers.

Ultimately, however, Mentor's unwillingness to come to the table, coupled with the harsh economic environment and Cadence's deteriorating financial performance, made it impossible for the would-be acquirer to gain favorable financing. Cadence gave up its pursuit.

For the telecom equipment, DRAM and EDA industries, growth will continue to remain elusive, and in a recession there are no panaceas.

Even such aggressive measures often are not enough. Repeatedly, over the 30-year history of the chip design software industry, success for leading companies has been followed by sudden slides into irrelevancy. Names like Daisy Systems Corp. and Valid Logic Systems Inc. once graced the upper echelons of the EDA industry, only to fade away thanks to management problems, failed mergers and rapid technology shifts.

Similarly, the memory chip industry's booms and busts have claimed many prominent victims in recent decades. Texas Instruments Inc. in 1999 sold its DRAM operations to Micron Technology Inc. in a deal that propelled the Boise, Idaho, chipmaker from fifth to second in the sector.

So what is the fate of companies that pass from maturity into old age? Again, Nortel's options are typical.

The company could become an acquisition target if it clears some of its debt off the books, overcomes the hurdle of a highly unionized workforce and sells off some business lines, though it has put at least one unit on the block with no success so far. Then there's the distinct possibility that Nortel will become yet another victim of a market transition it failed to predict.

"This market not only needs to consolidate through acquisition, but also through attrition," Kerravala says. "That wouldn't be the worst thing for this market."