Nokia Cuts Another 3,500 Jobs, Moves To Ballast Nokia Siemens Networks8:34 AM EST Thu. Sep. 29, 2011
Nokia will cut an additional 3,500 jobs and possibly close a number of manufacturing facilities -- both moves part of an ongoing downsizing at the once-powerful mobile device maker.
Specifically, Nokia said it will close a manufacturing facility in Romania by the end of 2011 and will "review the long-term role" of similar operations in Finland, Hungary and Mexico.
"We must take painful, yet necessary, steps to align our workforce and operations with our path forward," said Stephen Elop, Nokia's CEO, in a statement. He said Nokia is seeing "solid progress" with its changes.
Elop, formerly head of Microsoft's Business Division, took over Nokia's top job nearly a year ago and his tenure has thus far been largely about broad-stroke cuts and a strategic overhaul.
In April, Nokia confirmed plans to cut 7,000 jobs overall and move responsibility for software development on its Symbian OS, as well as 3,000 employees, to systems integration giant Accenture.
Symbian, by most estimates, exited 2010 as the world's most widely deployed mobile OS, but its market share, and Nokia's as a manufacturer, have both been in steep decline thanks to competition from Apple's iPhone and a legion of Google Android devices. According to several researchers, the Android platform finally eclipsed Symbian as the market leader in January of this year.
Nokia appears to have left Symbian behind, along with other previously trumpeted mobile OS ventures. Under Elop's watch, Nokia has shifted its mobile device focus away from Symbian and toward Microsoft's Windows Phone 7 as Nokia's go-to platform.
Nokia's latest round of layoffs is expected to be completed by the end of 2012, Nokia said Thursday. The 3,500 number is a combination of about 2,200 employees in the Ciuj, Romania-based factory, and 1,300 employees in Nokia's Location & Commerce business, which was formed by consolidating Nokia's NAVTEQ and social location services operations.
Elsewhere, Nokia and Siemens on Thursday confirmed a new executive chairman and a substantial cash infusion for Nokia Siemens Networks, the joint venture of the two companies focused on developing telecom carrier equipment and infrastructure.
Jesper Ovesen will be Nokia Siemens Networks' executive chairman, and he will have a "special emphasis on overseeing the strategic direction of Nokia SIemens Networks as it seeks to strengthen its position as a leader in the industry and become a more independent entity," according to a Nokia statement.
Ovesen was most recently chief financial officer at Danish telecommunications group TDC. His appointment also means the exit of former Nokia CEO Olli-Pekka Kallsvuo, whom Nokia confirmed has stepped down from his position as non-executive chairman.
Nokia Siemens will also see a capital boost of about 1 billion Euro (roughly $1.35 billion) from its two namesakes, Nokia confirmed. The venture, which has been unprofitable for all but two quarters since its 2007 founding and lost nearly $1 billion in 2010, has been trying to boost its international profile and gain a foothold in key markets like North America.
Earlier this year, it acquired wireless infrastructure assets from Motorola Solutions for about $975 million -- a move that made it the third largest wireless infrastructure vendor in the U.S. and the second largest in the world, behind Ericsson. The company's channel program focuses on utilities, transportation, public sector and some enterprise business.