Nokia 2010 Annual Report Download - page 89

be partially or even entirely comprised of network components manufactured and installed by other
vendors. The five year, five country deal signed with NII Nextel during 2010 is an example of the
outsourcing of management of a network in which Nokia Siemens Networks has no hardware
elements.
Nokia Siemens Networks believes it has a strong competitive position in managed services and
continues to invest and innovate to ensure that it can maintain and enhance that position.
Subscribercentric Solutions
As operators in many markets see the growth of net new subscribers slowing or even stopping, they
are increasingly focused on leveraging the value of the subscribers they have. As the acquisition of new
subscribers to networks in such markets can be both difficult and expensive, customers look to limit
“churn”, where endusers transfer to a rival service provider, as well as to increase the revenue derived
from each user through the addition of valueadded services, such as access to media and
entertainment and social networking services. This often requires that operators invest in software and
solutions that allow customers to enjoy an improved experience. One of the key foundations for this
improved enduser experience is understanding an enduser’s behavior and preferences, which in turn
allows the operator to tailor service offerings to the individual consumer. This not only includes services
and applications, but also bespoke billing platforms and identity management solutions.
Nokia Siemens Networks continues to develop and enhance its offerings in this area. Nokia Siemens
Networks believes it has the industry’s leading subscriber database management platform,
complemented by flexible billing and charging platforms and other software and solutions that
provide its customers with the tools, flexibility and agility required to respond to a rapidly changing
enduser market. Nokia Siemens Networks also provides business process and consulting services that
help to lead its customers through business transformation opportunities.
Motorola Acquisition
On July 19, 2010 Nokia Siemens Networks announced that it had entered into an agreement to
acquire the majority of Motorola wireless network assets for USD 1.2 billion. Under the terms of the
agreement, Nokia Siemens Networks will acquire assets related to the development, manufacture and
sale of CDMA, WiMAX, WCDMA, LTE and GSM products and services, as well as approximately
7 500 employees and assets in 63 countries, including large development sites in the United States,
China and India.
Nokia Siemens Networks’ acquisition of Motorola’s wireless networks infrastructure assets has
received antitrust approvals from all jurisdictions except China, where approval of the regulatory
authorities is still pending. Nokia Siemens Networks is continuing to work with the Chinese
regulatory authorities to get the final antitrust approval. The Motorola acquisition is expected to close
after the final antitrust approval by the Chinese regulatory authorities has been granted and the other
closing conditions have been met.
Outlook, Targets and Priorities for 2011
After the stabilization of the infrastructure market in 2010, following the declines of 2009, overall
market conditions are expected to continue to improve in 2011. Nokia Siemens Networks expects
industry revenues to grow slightly in 2011 compared to 2010. While growth is expected in certain
areas, such as mobile broadband and services, this is expected to be offset to some extent by declines
in certain areas and a continued challenging competitive environment.
In the context of these market conditions, Nokia Siemens Networks has clearly defined priorities.
Firstly, it continues to drive for growth. Nokia Siemens Networks does not believe in growth at any
cost, but does believe that maintaining scale is essential—a key milestone here is the expected
completion of the Motorola transaction, which we believe would allow Nokia Siemens Networks to
leverage those assets to accelerate its progress in North America.
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