Nokia Siemens Networks' Chief Welcomes Nortel Employees

Since January, the Nortel bankruptcy details emerged, the question has been not so much what will happen with Nortel, but who will buy its valuable businesses and when. It was a foregone conclusion that its key assets would find new owners, which would shake up the communications landscape.

 

Rich Tehrani noted back in April that a slew of competitors in both the carrier and enterprise markets could be -- even should be -- looking to profit from the struggles of what was once the largest telecom equipment manufacturer in North America, and Canada's largest company in terms of stock value.

 

Rich predicted at the end of April the Nortel might soon be gone a standalone business.

 

"The news is sad but true. It looks like Avaya or Siemens could pick up the enterprise pieces. The optical division could go to Fujitsu, Huawei, Alcatel-Lucent or potentially a private equity firm. The wireless unit could go to NSN," he wrote.

 

That's just what we may now be seeing, as NSN and Nortel have agreed to a $650 million deal for Nortel's CDMA business, along with a research group focused on LTE. 

 

It's common knowledge that Nokia Siemens Networks has been looking for a way into the North American market -- this is its move to make that happen.

 

"It is no secret that Nokia Siemens Networks has a lower market share in North America than we do in other parts of the world -- and adding all of you from the CDMA team would help us gain scale in the region," wrote NSN's CEO Simon Beresford-Wylie in a letter addressed to the Nortel employees that will be impacted by the acquisition. "Critically, it would also help us build stronger, deeper relationships with key customers."

 

In addition to providing access to a tremendous CDMA user base, the move strategically positions NSN in the growing LTE market, which could potentially include being added as a third infrastructure vendor for Verizon Wireless' LTE development. It's believed that the wireless carrier is open to adding a third partner, with the caveat that that third vendor must first take over Nortel's CDMA business. Enter Nokia Siemens Networks, which already has an LTE presence in Europe.

 

"We'd like to have Ottawa become a long-term wireless center of excellence within Nokia Siemens Networks, complementing our other global sites," said Beresford-Wylie.  "We have made an offer for the LTE assets not because we want to restructure the team - we did it because we want your skills and expertise as part of Nokia Siemens Networks."