Nokia Siemens Networks (NSN) says it will buy the better part of Motorola’s network equipment business for $1.2 billion. The deal, which is expected to close by the end of this year, will add 50 mobile operators such as Verizon, China Mobile and Sprint to Nokia Siemens‘ list of clients.
Around 7,500 workers will stay on board and continue working at R&D sites and production plants in the USA, China and India. Nokia Siemens will be able to produce more CDMA-based equipment thanks to the takeover. Additional revenue might help Nokia’s struggling CEO sit in office a month longer before being dumped.
Alas, it is also acquiring “a market leader in WiMAX, with 41 contracts in 21 countries” at a point in time when the world plus dog are running around in circles of angst fearing the standard will go downhill as the real 4G mobile standard LTE will rise over the next few years.
Motorola’s networks business however also produces LTE and both parties reassure the unit has “excellent traction with LTE early adopters”, so there’s nothing anyone should be scared of. After all, dropping demand for WiMAX ought to be substituted by rising orders for LTE equipment.
“Together, we will utilize the combined strength of Nokia Siemens Networks’ TD-LTE solutions and Motorola’s WiMAX and LTE businesses, to better meet customers’ evolving technology and business needs,” said Bosco Novak, head of customer operations at Nokia Siemens Networks.
Motorola will keep its iDEN business and nearly all the patents related to wireless networks, meaning Nokia Siemens will probably have to shell out royalties on top of it all.