However, the London 2012 organizers (LOCOG) will take a £15 million hit on the deal, since Nortel was one of the eight tier one sponsors, paying the organizers £40 million, while Cisco will be a Tier 2 backer.

The organizers said they had to seek an alternative supplier because of uncertainty surrounding the company's future, which had to file for bankruptcy protection earlier this year, but insisted the contract was terminated "on good terms" and that the change was "not a big blow".

Nortel was dropped after it announced it would try to sell itself off in pieces.

"Technology for the Games is a huge undertaking with a fixed deadline, relying on finalizing the design and building of systems. In order to deliver 'the most connected Games possible', LOCOG felt it was vital to work with a single business to cover the entire network infrastructure," the organizers said in a statement.

Nortel is also a sponsor of the 2010 winter games in Vancouver, Canada, but a spokesman says the network buildout there is 85 percent complete. "We remain fully committed to the 2010 Vancouver Winter Olympic Games," the company said in a statement.