Nokia Siemens ties up with TCS for R&D outsourcing
01 Mar 2008
Mumbai: Telecom gear maker Nokia Siemens Networks has agreed to outsource some of its research and development operations to Tata Consultancy Services.
As part of the agreement, Nokia Siemens Networks will reassign functions at its development center in Duesseldorf, Germany, and transfer 90 employees - about a third of its R&D personnel in Duesseldorf - to TCS, Nokia Siemens said in a statement.
The Finnish-German joint venture said it also plans to cut 239 jobs in Finland as part of plan to slash costs. The Company will have around 8,300 employees in Finland after the reduction.
The Nokia-Siemens joint venture, which employs more than 60,000 globally, plans to shed around 9,000 jobs worldwide.
Nokia Siemens has some 3,500 R&D personnel in Germany alone. The outsourcing agreement is expected to result in a saving of 2 billion euros ($3 billion) annually for the company.
The emergence of Asian players like Huawei Technologies and ZTE who make cheaper products, have hit margins of network equipment makers like Nokia Siemens, Alcatel-Lucent and Sony Ericsson.
This has also forced top gear makers like Ericsson to abandon deals in places where prices have been pushed too low.