Nokia Siemens ringing up the right numbers
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Nokia Siemens Networks - a joint venture between Nokia Oyj and Siemens AG - will complete its acquisition of Motorola Inc's network equipment assets on April 29.
The completion comes after the company finally got the green light from all nine antitrust regulators worldwide, according to Nokia Siemens' China president. The deal was approved by China's Ministry of Commerce on Wednesday.
The $975 million acquisition will give Nokia Siemens access to Motorola's technology in second-generation (2G) mobile telecommunications and the latest fourth-generation (4G) TD-LTE (Time Division-Long Term Evolution) equipment, said Zhang Zhiqiang, president of Nokia Siemens Greater China region.
About 7,000 employees of Motorola Solutions Inc are set to transfer to Nokia Siemens by April 29, and 2,800 of them are based in China, Zhang told China Daily on Monday.
"We believe this is a good deal. The acquisition will increase our competitive strength globally, especially in the United States and in Japan," Zhang said.
He also added that the acquisition will expand the customer base for Nokia Siemens' CDMA (Code Division Multiple Access) network, but declined to reveal specific figures.
In China, the deal means that current customers of Motorola Solutions will transfer to Nokia Siemens, helping to raise its market share with major clients, including China Mobile Ltd and China Unicom Ltd.
According to the company's financial report, the Chinese market contributed 322 million euros ($470 million) to Nokia Siemens' total revenue in the first quarter of 2011, a rise of 17 percent from a year earlier. The company announced last Thursday that its global revenue reached 3.17 billion euros during the same period.
In addition to the supply of second- and third-generation equipment in China, Zhang said Nokia Siemens is starting to focus on TD-LTE technology - a homegrown Chinese fourth-generation (4G) telecommunication standard developed by China Mobile.
"TD-LTE could be a mainstream 4G telecommunications standard because of its lower cost compared with other 4G technologies," Zhang said.
Nokia Siemens is the first foreign vendor of telecom equipment to gain approval from the Chinese authorities to participate in the country's wide-ranging trials of TD-LTE, according to Zhang.
It now provides TD-LTE equipment and cooperates with China Mobile in Hangzhou, one of seven cities that have been conducting TD-LTE trials since January.
"Both Motorola and Nokia Siemens have achieved significant progress in TD-LTE technology. When the deal is complete, I am confident that our company will be the leader in the global TD-LTE market," Zhang said.
China will double its annual spending on 4G networking equipment during each of the next four years, according to a report issued by the research company IHS ISuppli. China's investment in 4G will double to $100 million this year from $50 million last year, the report said.
