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Nokia & Siemens Form 'Nokia Siemens Networks'

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Ugly phone manufacturer Nokia and former ugly phone manufacturer Siemens today announced a deal to merge the Networks Business Group of Nokia and the carrier-related operations of Siemens into a new company called Nokia Siemens Networks.



The 50-50 joint venture will create a global monolith in the areas of fixed and mobile network infrastructure and service which would’ve had pro forma revenues of 15.8bn euros had it existed in 2005. Based on current market share date, Nokia Siemens Networks will become the second largest company in mobile infrastructure, second in services, third in fixed infrastructure and the third largest in the overall telecommunications infrastructure market. On the other hand, it’s going to cost jobs…

The two businesses believe the merger will save 1.5bn euros annually by 2010 but this comes “primarily from the elimination of overlapping functions”. Consequently, expect heads to roll in sales, marketing and R&D while overheads and sourcing costs should both reduce substantially. In fact, 10 to 15 per cent of the initial combined workforce of 60,000 will have been cut adrift by 2010.

Formal completion of the merger is scheduled for 1 January 2007. If you’re about to start a university degree in telecommunications or networking this September may I suggest moving to something with more career potential at the end of it such as Art History, Sociology, Needlework or Zimbabwean Tourism…

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Siemens UK

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