THE PURCHASE OF MOTOROLA’S NETWORK BUSINESS RETURNS NOKIA SIEMENS TO #2 IN NETWORK EQUIPMENT SHARE - TBR COMMENTARY - Sponsored Whitepaper

The acquisition of Motorola’s Networks business makes Nokia Siemens the world’s number-two network equipment maker, displacing Huawei. For $1.2 billion plus $50 million Motorola will retain in accounts receivable, Nokia Siemens assumes Motorola’s broad portfolio of GSM, WCDMA, CDMA, WiMAX and LTE equipment, as well as significant customer relationships with over 50 operators including Verizon, Vodafone, China Mobile, Sprint, Clearwire and KDDI. The combination will pose a legitimate threat to equipment leader Ericsson, create a formidable competitor to Alcatel-Lucent in North America, as well as a badly needed foothold for Nokia Siemens in North America.

TBR believes the acquisition is key to making Nokia Siemens competitive in the North American market, where the vendor has struggled against Ericsson and Alcatel-Lucent, exemplified by recent LTE contracts from AT&T and Verizon. Nokia Siemens’ re-entry into the WiMAX market will provide key contracts with several operators, including Clearwire (and, indirectly, with Sprint), as well as other WiMAX operators internationally. While many vendors struggle to achieve profitability, Motorola’s Networks business has remained profitable recently despite the marked slowdown in operator investment.