3GSM: Nokia, Siemens outline joint venture planes

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Nokia and Siemens unveiled their plans for the joint venture between the two companies which will see the companies create a mobile phone network giant. The merger of the companies' divisions will close at the end of the first quarter of this year.

Speaking at the 3GSM World Congress, Nokia Siemens Networks (NSN) chief operations officer-designate Mika Vehvilainen said that customers have been positive about the merger. "Our customers have crucial decisions to make about their business going forward, therefore clarity for them about our planned portfolio is a key strategic priority."

The new company will incorporate six business units; Radio Access, Service Core and Applications, Operation Support Systems, Broadband Access, IP/Transport, and Services.

NSN will eventually move its installed base of existing Nokia and Siemens equipment to a common Radio Network Controller (RNC) as well as an umbrella solution for managing convergent and multi-vendor networks based on Nokia's NetAct platform. The new company will also migrate to a common microwave transport solution and a single IP DSLAM solution.

Analysts said there wasn't any real surprise in the announcement as the companies had already run through the portfolio before 3GSM.

"Essentially, solutions which have a larger market share than others are likely to become the core of the product portfolio of the company on the long run," said Jean-Charles Doineau, principal analyst at Ovum.

"In the short and middle term, nothing changes, as most of the product lines are kept in, supported, and even developed. In the fixed side of the business, it is no surprise that the NSN product portfolio will be based on Siemens' existing portfolio," he said.

He added that on the mobile side, areas where Siemens product are taking over Nokia's technologies are very rare, and essentially located in the service control area.

"NSN has chosen to build on investments performed at an ATCA level by Siemens for its multi-purpose computing platform - the CFX 5000, and will build its IMS portfolio going forward on this foundation."

Doineau said that in radio access area, all products are still part of the picture, and will be going forward. Integration is planned on the middle term at an RNC level, with the development of a new solution. "No surprises then - and that's probably what makes the more sense from a customer perspective."

"But the more difficult is yet to come, as NSN will have to build on this going forward a common vision out of the jigsaw - something that we are still eager to see happening," said Doineau.

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