Nokia today announced its plans to buy Siemens out of the Nokia Siemens Networks (NSN) joint venture for €1.7bn*. The decision gave way to more debate around the strength of Nokia’s balance sheet, despite the recent return to profitability by NSN, thanks to its restructuring.
Askar Sheibani, CEO of UK IT and telecoms repair company Comtek, offers the following comments on the deal and what it means for the industry:
“Nokia’s decision to take sole ownership of NSN is great news for the telecoms industry. Following the significant restructure, and its focus on 4G LTE networks, that allowed NSN to return to profitability, this next chapter will provide Nokia with the opportunity to see healthy returns, particularly as 4G becomes increasingly mainstream. While targeting this new area of growth will certainly have the potential to benefit Nokia’s bottom line, it is critical that the company continues to maintain its entire portfolio of products, as any drops in service could damage the company’s reputation, putting customer confidence on the line.
“During this transitional phase, Nokia cannot afford to take for granted existing customers using legacy products. Indeed, to be truly successful the company should seriously consider expanding its support services to ensure that the legacy products that make up its existing telecoms infrastructure continue to be effectively served and maintained. Third party repair and support companies may be the solution though and provide a way to harness more resources and expertise at a time of increased demand for Nokia. The world and its media are most certainly watching Nokia with keen interest, and at this delicate time, it is absolutely vital that the company demonstrates its competence when it has so many balls in the air.”
Lindsey Challis and Jacqueline Booker
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