Nokia 2012 Annual Report Download - page 64

Nokia Siemens Networks
Overview
Nokia Siemens Networks is a leading global provider of telecommunications infrastructure, with a focus
on the mobile broadband market. In its target market, Nokia Siemens Networks believes it is the second
largest company worldwide, by revenue. It has a strong position in the newer infrastructure technologies
of 3G and 4G (LTE). In 3G, Nokia Siemens Networks is the industry leader by customers served. More
than a billion subscribers connect through Nokia Siemens Networks’ 3G networks. In LTE, Nokia
Siemens Networks had 77 commercial contracts at the end of 2012. The company is the number one
provider of subscriber database management, an essential tool in effective network operations.
Nokia Siemens Networks began operations on April 1, 2007, combining the networks business of
Nokia Corporation and the carrier-related operations of Siemens AG for fixed and mobile networks.
Nokia Siemens Networks is jointly owned by Nokia and Siemens and its financial results are
consolidated by Nokia. Beginning on April 3, 2013, certain restrictions on the transfer of Nokia’s and
Siemens’ interests in Nokia Siemens Networks expire and certain other provisions relating to the
transfer of such interests come into effect. Otherwise, the arrangements between Nokia and Siemens
as shareholders of Nokia Siemens Networks will remain in effect as originally agreed.
Nokia Siemens Networks’ focus on mobile broadband began towards the end of 2011, when the
company adopted a new strategy (please see the section “Strategy” below). Mobile broadband
provides many opportunities for Nokia Siemens Networks. The company believes the market will
continue to grow as mobile operators face the challenge of increasing demand for greater network
capacity and improved user experience. At the same time, mobile operators are continually seeking
ways to meet subscriber demands in a cost-effective manner. With a specialist approach to mobile
broadband, targeted research and development and streamlined structure, Nokia Siemens Networks
believes it is well placed to meet these operators’ needs.
The company has an installed base of around 600 customers worldwide and serves 2.5 billion
subscribers. Nokia Siemens Networks’ customers include many of the world’s largest mobile operators
and the company is proud to count Bharti Airtel, China Mobile, Deutsche Telekom, Softbank,
Telefónica, Verizon and Vodafone among them.
For the year ended December 31, 2012, Nokia Siemens Networks had net sales of EUR 13.8 billion
and total assets of EUR 10.2 billion.
Nokia Siemens Networks has, since late 2011, been engaged in a significant restructuring program.
This program, which is intended to continue throughout 2013, has already delivered substantial
improvements to operating expenses and profitability. Please see the section “Restructuring” below.
Strategy
Focus
Nokia Siemens Networks announced its current strategy on November 23, 2011. Built around focus
(both technological and geographic), quality and innovation, the strategy guides Nokia Siemens
Networks to focus its business solely on mobile broadband; for example, by divesting a number of
businesses and streamlining its portfolio. Please see the section “Non-core businesses, divestments
and portfolio management” below.
The company also named Japan, Korea and the United States as “priority markets”, attracting
appropriate managerial focus, while putting specific turnaround initiatives in place also in other regions
and exiting a number of less-profitable countries and projects.
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