After a slew of bad years, Nokia still hasn’t found their footing yet. Once one of the dominant handset and wireless hardware firms, the Finnish firm has struggled in the changing landscape. 2 years after dumping their Lumia and handset business on Microsoft, the company looks to be cutting more of its staff. The cuts come as part of the massive $16.6 billion Alcatel-Lucent acquisition, with up to 14% of staff from both firms being cut.
According to the source, Nokia is set to cut 10,000 to 15,000 jobs in total out of their global workforce of 104,000. The cuts come as part of the $1 billion in cuts due to the overlap between Nokia and Alcatel-Lucent. These cuts will occur in over 30 countries but will heavily impact Germany and France but Finland will be the hardest hit. This comes as the multinational refocuses their attention away from the mobile device and infrastructure market and more into their telecommunications side of their business.
In order to find more growth, Nokia is turning to software and service contracts as they are generally more lucrative. What this all means for future Nokia handsets, their supposed mobile comeback and other hardware ventures like the OZO Camera remains to be seen. I for one hope the company re-enters the smartphone market.
The negotiations are complete and it looks like famed Finnish company Nokia agreed to purchase French telecommunications equipment company Alcatel-Lucent for the staggering sum of $16.6 billion. The move is aimed to improve Nokia’s presence in the networking equipment field in order to compete with Huawei and Ericsson, and it will surely pay off as Alcatel-Lucent is known for its expertise as far as mobile, fixed and converged networking hardware is concerned. The acquisition announcement is followed by promising news, as Nokia confirmed that it plans to continue its research for “5G, IP and software-defined networking, cloud, analytics as well as sensors and imaging.”
“The combined company will have unparalleled innovation capabilities, with Alcatel-Lucent’s Bell Labs and Nokia’s FutureWorks, as well as Nokia Technologies, which will stay as a separate entity with a clear focus on licensing and the incubation of new technologies. With more than 40 000 R&D employees and spend of EUR 4.7 billion in R&D in 2014, the combined company will be in a position to accelerate development of future technologies including 5G, IP and software-defined networking, cloud, analytics as well as sensors and imaging.”
The Board of Directors from each company has already agreed to the transaction’s terms, which are still pending approval from Nokia’s shareholders. The deal should be completed in the first half of 2016. Before selling its Devices and Services division to Microsoft, Nokia used to be one of the world’s most appreciated mobile phone manufacturers. Now, it looks like the company has new objectives in different fields, but the important thing is that it’s still alive and well.
After quite a bit of media speculation, Nokia and Alcatel-Lucent recently confirmed that they are, in fact, talking about a deal that could bring about the merger of the two companies. Keep in mind that negotiations could still go south at this point, but if the deal would actually materialize, it would allow the firms to expand their respective product portfolios as well as their reach. It’s not difficult to understand why a mobile broadband specialist such as Nokia would seek to join forces with a fixed network specialist such as Alcatel-Lucent. Even though the market is heavily focused on mobile networks right now, fixed broadband networks maintain their usefulness by providing access to high-quality video content while supporting home-based Wi-Fi networks.
Furthermore, as Ericsson and Huawei currently occupy the top two positions in the access networks market, a merger would give Nokia and Alcatel-Lucent a better chance at competing with these giants. Obviously, combining two companies with significant cultural differences brings its own set of difficulties, but this is to be expected when a Finnish-German company buys a French-American one. Just in case you weren’t aware, Nokia is heavily invested 5G research, which is set to become the next mobile telecommunications standard. Purchasing new assets at this time does sound like a good idea, but all we can do now is wait and see what happens next. We’ll keep you posted as the story develops.
Thank you Pcworld for providing us with this information.