Nokia to transfer 200 employees to subcontractor

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The Finnish Mobile phone giant Nokia is to transfer part of its microchip development to its long-time subcontractor, the Italian-French STMicroelectronics.
      At the same time 200 of Nokia’s staff will be transferred into the employ of the subcontractor. Nokia announced the start of the required personnel consultation process on Wednesday.
      Most of the employees in question work in Finland, and the rest in the United Kingdom.
     
The importance of a powerful chip is emphasised by the new cutting-edge portable technology that has already seen the mobile phones become miniature computers and multi-media devices.
      Nokia justifies the outsourcing by its desire to widen its subcontractor base, to make use of outside innovation capacities, and to increase competition between the subcontractors.
      According to market estimates, the deal between Nokia and STMicroelectronics will particularly complicate things for the Finnish firm’s most important chip provider, Texas Instruments.
     
Nokia itself wants to concentrate on its core competences and, on the other hand, to invest more and more in the development of programmes and Internet services.
      After the outsourcing, STMicroelectronics will design and manufacture the chips used in Nokia’s 3G devices. Nokia’s other chip providers include Broadcom, Infineon, and Texas Instruments. Nokia itself will only continue the research and development of chips related to its modem technologies.
      On Wednesday Nokia refrained from revealing how much the arrangement will be costing STMicroelectronics.


Links:
  STMicroelectronics press release

Helsingin Sanomat