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Nokia maps out new supply, chip development strategies

Posted: 10 Aug 2007 ?? ?Print Version ?Bookmark and Share

Keywords:chip development? new road maps? Nokia supplier?

Nokia will discontinue its in-house mobile phone chip development and plans to use significantly more devices from outside sources in an attempt to use its resources in other parts of its business, notably software.

The Finnish mobile phone maker said it wants to focus on its core competencies in chipset development and on modem technology. It added the change in strategy would foster competition in the global chipset industry.

As an initial step, Nokia has struck a significant deal with STMicroelectronics whereby the latter would take over as many as 200 of Nokia's 3G chip development group in Finland and the U.K. as an extension of the two firm's existing collaboration on handset chipsets.

Nokia stressed Texas Instruments Inc. would continue to be a major supplier of silicon for its handsets across all protocols and also announced August 8 that it has picked Broadcom as a supplier of chips for Edge phones. Infineon Technologies will also play a major part in the renewed strategy as chip supplier for GSM handsets.

The phone maker added it would continue to develop its leading modem technology, which includes protocol software and related digital design for W-CDMA/GSM and its evolution. It plans to license this modem technology to its chipset manufacturers, who will use it in the chipsets they develop and produce for Nokia and if they so decide in the chipsets they produce for the open market.

"This is a pragmatic move in the face of an increasingly complex technology environment," said Niklas Savander, executive VP, Nokia Technology Platforms. "Companies in this industry need to focus on areas where they can add value and partner with others where it makes sense. We believe that our renewed strategy will allow us to concentrate on developing core chipset technologies, while increasing our R&D efficiencies and improving our agility in a fast-moving marketplace."

The deal with Broadcom is a significant one for the chip supplier and the first for the so-called "Venus" single-chip Edge multimedia processor, launched earlier this year at the 3GSM Congress in Barcelona, Spain.

- John Walko
EE Times Europe

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