TORONTO — Nortel Networks Corp. (TSX:NT) is reportedly in talks to shuffle large pieces of its business to Nokia Siemens Networks, and that could send a flood of customers and new technologies into the hands of the world’s No.1 cellphone maker.
The Wall Street Journal said that agreement would include Nortel’s profitable carrier networks unit — which markets to phone companies and the like — and a research unit developing a next-generation wireless technology.
Edward Zabitski, an analyst at ACI Research, said that buying up the assets would give Nokia Siemens a competitive advantage and access to Nortel’s customers, which it could then transition into the next generation of cellphone technology.
The iconic Canadian telecom technology company, which originated as part of Bell Canada and has a history stretching back a century, has suffered multiple blows in recent years and has been operating under court protection since January.
Some observers say Nortel has suffered from a lack of foresight and a slow response to developing changes in the industry and technology.
Zabitski says that it could be attractive for Nokia Siemens to shift Nortel customers still using the CDMA wireless standard to a technology.
Nokia Siemens is a joint venture between Finland’s Nokia Corp. (NYSE:NOK) and Siemens AG (NYSE:SI), the German industrial conglomerate.
Nokia has been a leading vendor of the GSM standard, which is used throughout Europe and many other parts of the world. North American carriers have historically backed the CDMA standard but the balance has been tipping as wireless technologies evolve.