Nokia Corporation
(ADR)(NYSE:NOK) Siemens Network, mobile network equipment maker, is in
discussions with several companies to sell its business support systems unit as
it seeks to do away with some product lines and devote focus on mobile
broadband.
Formed by Siemens and
Nokia in 2007, Nokia Siemens has been struggling for profitability as a result
of pricing pressure from ZTE Corp and Huawei Technologies, the Chinese rivals.
It is also facing competition from Ericsson in Sweden. There has been a huge
economic downturn that has crimped expenses by telecom companies.
Overall expenses by
telecom companies are predicted to fall flat this year, as per CEO Rajeev Suri
in Bangalore. However, Nokia Siemens sees some rebound in investments by
clients in the US.
To enhance success,
Nokia Siemens is selling non-core units and laying off about a quarter of its
staff.
The company has
reportedly sold off its network equipment for wired networks and left the
market for a wireless technology, WilMax, which has failed to win support among
carriers as LTE.
Ericsson was reported
to be in a position to buy Nokia Siemen’s BSS unit earlier this month. The unit
is accountable for billing and charging systems for telecom operators.
Suri has mentioned that
the group’s restructuring was on track. The company is believed to be 6 months
ahead the plan. Suri expects workforce in India to see an increase after the
restructuring as the firm scales up its offshore services in the country. The
firm presently has around 10,000 staff in India.
The restructuring seems
to be positive for Nokia Siemens generating positive fund for three straight
quarters and Suri predicts that to be sustainable. He said that the company has
taken out considerable amount of headcount already and it is on track in the
business line divesture too.
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