In the past two days Nokia Siemens Networks announced a $900 million GSM expansion deal with India's Bharti Airtel Ltd. and one with China Mobile Group Yunnan Co. valued at €70m ($95m). Nokia Siemens will expand Airtel's GSM wireless service in eight regions in India. It will also install 1.8 million next-generation long distance ports on Airtel's fixed-line network and increase its international pre-paid calling card service capacity by 4.5m users. Rival Ericsson has an existing $1b GSM expansion contract with Airtel. A spokeswoman said Ericsson is in negotiations with Airtel about a new contract similar to Nokia Siemens'. On Monday, Nokia Siemens said it plans to invest $100m over three years in India on building a manufacturing plant. It also plans to expand its research facilities in Bangalore. The GSM expansion deal in China with Yunnan covers 11 provincial cities totaling 12m subscribers. The agreement includes various equipment and service provisions and will be operational this October.
Sources: Press release I, II, Bloomberg, MarketWatch, Wall Street Journal
Commentary: Nokia Siemens Networks To Slash 15% of Its Workforce; Shares Decline • Nokia Siemens JV Cuts '07 Market Outlook • Nokia Siemens JV Finalized
Stocks/ETFs to watch: Nokia Corp. (NYSE:NOK), Siemens AG (SI). Competitors: LM Ericsson Telephone Co. (NASDAQ:ERIC), Cisco Systems Inc. (NASDAQ:CSCO), Alcatel-Lucent (NYSE:ALU), Motorola Inc. (MOT). ETFs: iShares Goldman Sachs Network Index Fund (NYSEARCA:IGN), PowerShares Dynamic Networking (NYSEARCA:PXQ), iShares MSCI Germany Index (NYSEARCA:EWG)
Conference call transcripts: Nokia Q1 2007, LM Ericsson Q1 2007
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