Telecom Lead Europe: Mobile broadband equipment
major Nokia Siemens Networks is set to sell its business support systems
division. According to media reports, Ericsson, Amdocs and private-equity firms
have shown interest in the potential sell-off of NSN’s BSS division.
It is expected that the transaction may fetch as much as
300 million euros ($377 million).
The sell-off is in line with the company’s strategy to
increase focus on mobile broadband business. In the last 12 months, Nokia
Siemens exited from several businesses including WiMAX.
The struggling Nokia Siemens is keen to cut costs. The
business support systems division sell-off is a part of NSN’s process of
slashing 17,000 jobs by the end of next year in a bid to save EUR 1 billion.
In March this year, Nokia Siemens slashed 3,500 new jobs in Brazil after
ending a service deal with Oi. Additionally, NSN also sold its WiMax wireless
business to NewNet Communication Technologies.
NSN also completed the sale of its microwave transport
business and fixed line broadband access business too DragonWave and Adtran
respectively.
As part of increasing focus on mobile broadband business,
NSN grabbed contracts from Softbank Mobile and KDDI in Japan in Q2. Also, the
company was selected by T-Mobile in the U.S., StarHub in Singapore, Tele2 in
Estonia, Latvia and Lithuania, Hrvatski Telekom in Croatia, Zain in Saudi
Arabia and TOT in Thailand.
The business of NSN has largely been affected by Chinese
gear makers-ZTE and Huawei that are offering relatively cheap network gears to
the global operators. Additionally, the business of NSN has also been impacted
by the ongoing downturn in Eurozone.
Nokia Siemens Networks posted 8 percent dip in second quarter
sales to EUR 3.34 billion from EUR 3.64 billion in the same quarter previous
year.
Apart from NSN, Alcatel-Lucent and Ericsson have also
scaled-down its operations. While Alcatel-Lucent is cutting 5,000 jobs to
reduce costs, Ericsson has decided sell its fiber access business to Calix.
However, comparatively Ericsson is still in a better
position to go ahead with its growth plans in future. Ericsson’s interest in
NSN’s BSS division could be connected to its approach to become the leader in
OSS/BSS market.
Recently, Ericsson was ranked second in Operation and Business
Support Systems (OSS/BSS) and next generation Service Delivery Platforms by
Gartner.
Earlier in January this year, Ericsson acquired Telcordia for $1.15 billion to strengthen its position
in the OSS/BSS market.
Danish Khan
editor@telecomlead.com
