Launch Of Nokia Siemens Networks Is Readied - InformationWeek

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Launch Of Nokia Siemens Networks Is Readied

With yearly revenues of about $22 billion, Nokia Siemens Networks will rank as the world's second-largest supplier of gear to telecom carriers behind Ericsson.

Delayed by a corruption probe at Siemens AG, the firm's joint telecommunications equipment venture with Nokia will formally begin operations April 1. With yearly revenues of about 17 billion euros ($22 billion), Nokia Siemens Networks will rank as the world's second-largest supplier of gear to telecom carriers behind AB L. M. Ericsson and will rank slightly ahead of France's Alcatel-Lucent.

In an announcement Wednesday, the new firm said Siemens will contribute 2.4 billion euros and Nokia 1.7 euros billion to establish the new company, which will be based in Espoo, Finland, where Nokia is headquartered.

When the merger was announced last June, the companies estimated the new combined firm would save 1.5 billion euros annually through cost cutting and the elimination of duplication by 2010. The company has cited the advantages the merger will bring in developing business in the booming convergence booming convergence of fixed and mobile telecommunications.

"In the consolidating telecommunications market, Nokia Siemens Networks will offer customers cost-saving, leading-edge solutions that will also optimally meet their needs with regards to convergence," said Nokia CEO Olli-Pekka Kallasvuo, who will be board chairman of the new venture. Nokia will have four of the seven board seats in the new company. Simon Beresford-Wylie, currently head of Nokia Networks, will be the CEO of the new company.

Siemens has been emerging from a corruption scandal and Nokia Siemens Networks addressed the issue head-on as Day One of the new firm approached. "Nokia Siemens Networks has zero tolerance for financial or other business misconduct and has also defined anti-corruption policies, principles, and materials," the firms stated. "Since Nokia will consolidate the financial results of Nokia Siemens Networks, both companies have agreed that the compliance processes will be based on Nokia's system and practices."

In the U.S., the new company appeared to be jumping the gun as Siemens Communications announced Thursday an agreement with Nokia's Enterprise Solutions unit. According to Siemens, the firms will work together on interoperability issues between Siemens HiPath MobileConnect Enterprise Fixed Mobie Convergence Solution and Nokia's dual mode Eseries devices and Nokia's Intellisync Device Management Software.

"We see a huge opportunity for enterprise customers to benefit from Fixed Mobile Convergence," said Luc Roy, VP of product planning at HiPath Wireless, in a statement.

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