Motorola is already considering shuttering its handset division, The Wall Street Journal reported Monday. Talks of a partial merger, separate from that decision, would put a combined Nortel and Motorola company in position to reduce marketing, sales and research and development expenses, while capturing a combined $10 billion a year in sales, the report said.

The telecommunications equipment field has been in flux in recent years, with mergers providing its main customers, phone companies, greater leverage in making deals, while also waiting for the newest technology to provide video capabilities to hand-held phones.

Wireless equipment represents around one-third of Toronto-based Nortel's business. It would be about one-third of Motorola's business if they shed their hand-held division.