Nokia

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This article is about the telecommunications company. For other uses, see Nokia (disambiguation).
Nokia Corporation
Julkinen osakeyhtiö
(Public company)
Traded as OMXNOK1V
NYSENOK
Industry Telecommunications equipment
Computer software
Founded Tampere, Grand Duchy of Finland (1865)
incorporated in Nokia (1871)
Founder
Headquarters Espoo, Uusimaa, Finland[1]
Area served
Worldwide
Key people
Products List of Nokia products
Revenue Increase €12.73 billion (2014)[2]
Increase €1.63 billion (2014)[2]
Increase €1.17 billion (2014)[2]
Total assets Decrease €21.06 billion (2014)[2]
Total equity Increase €8.67 billion (2014)[2]
Number of employees
61,656 (Q4/2014)[2]
Subsidiaries Nokia Networks
Here
Nokia Technologies
Website Nokia

Nokia Corporation[3] (Finnish: Nokia Oyj, Finnish pronunciation: [ˈnokiɑ], UK /ˈnɒkiə/, US /ˈnkiə/) is a Finnish multinational communications and information technology company. Nokia is headquartered in Espoo, Uusimaa, in the greater Helsinki metropolitan area.[1] In 2014, Nokia employed 61,656 people across 120 countries, conducts sales in more than 150 countries and reported annual revenues of around €12.73 billion.[2] Nokia is a public limited-liability company listed on the Helsinki Stock Exchange and New York Stock Exchange.[4] It is the world's 274th-largest company measured by 2013 revenues according to the Fortune Global 500.[5]

The company currently focuses on large-scale telecommunications infrastructures, technology development and licensing, and online mapping services.[6] Nokia is also a significant contributor to the mobile telephony industry, having assisted in development of the GSM and LTE standards, and was, for a period, the largest vendor of mobile phones in the world. Nokia's dominance also extended into the smartphone industry through its Symbian platform, but it was soon overshadowed by the growing dominance of Apple's iPhone line and Android devices. Nokia eventually entered into a pact with Microsoft in 2011 to exclusively use its Windows Phone platform on future smartphones.

In September 2013, Microsoft announced that it would acquire Nokia's mobile phone business as part of an overall deal totaling €5.44 billion (US $7.17 billion).[7][8] Stephen Elop, Nokia's former CEO, and several other executives joined the new Microsoft Mobile subsidiary of Microsoft as part of the deal, which was completed on April 25, 2014.[9] In November 2014, Nokia began to license product designs and technologies to third-party manufacturers, to enable a continued presence for the Nokia brand in the consumer electronics hardware market.[6]

On April 15, 2015, Nokia announced that it would acquire the French telecommunications equipment company Alcatel-Lucent for €15.6 billion.

On June 18, 2015, Nokia's CEO Rajeev Suri revealed that the company plans to re-enter the mobile phone business in 2016.[10]

History[edit]

Main article: History of Nokia


2014 to present[edit]

In October 2014, Nokia and China Mobile signed a $970 million framework deal for delivery between 2014 and 2015.[11]

On November 17, 2014, Nokia technologies head Ramzi Haidamus disclosed that the company planned to re-enter the consumer electronics business by licensing in-house hardware designs and technologies to third-party manufacturers. Haidamus stated that the Nokia brand was "valuable" but "is diminishing in value, and that’s why it is important that we reverse that trend very quickly, imminently."[12] The next day, Nokia unveiled the N1, an Android tablet manufactured by Foxconn, as its first product following the Microsoft sale.[13] Haidamus emphasized that devices released under these licensing agreements would be held to high standards in production quality, and would "look and feel just like Nokia built it."[6]

Acquisition of Alcatel-Lucent[edit]

On April 14, 2015, Nokia confirmed that it was in talks with the French telecommunications equipment company Alcatel-Lucent regarding a potential merger.[14] The next day, Nokia officially announced that it had agreed to purchase Alcatel-Lucent for €15.6 billion in an all-stock deal.[15] The acquisition aims to create a stronger competitor to the rival firms Ericsson and Huawei, whom Nokia and Alcatel-Lucent had surpassed in terms of total combined revenue in 2014. The acquisition is expected to be completed in early 2016, and is subject to regulatory approval. At completion, Nokia shareholders will hold 66.5% while Alcatel-Lucent shareholders will hold 33.5% of the new combined company. The Bell Labs division will be maintained, but the Alcatel-Lucent brand will be replaced by Nokia.[15][16][17]

Potential sale of Here division[edit]

In April 2015, Nokia stated that it was evaluating strategic alternatives for its Here mapping division, which could result in its sale.[18]

Operations[edit]

Nokia is a public limited-liability company listed on the Helsinki and New York stock exchanges.[4] Nokia played a very large role in the economy of Finland.[19][20] It is an important employer in Finland and works with multiple local partners and subcontractors.[21] Nokia contributed 1.6% to Finland's GDP, and accounted for about 16% of Finland's exports in 2006.[22]

Nokia currently comprises three business groups: Nokia Networks, Here and Nokia Technologies.

Nokia Networks[edit]

Main article: Nokia Networks

Nokia Networks (previously known as Nokia Siemens Networks (NSN) and Nokia Solutions and Networks (NSN)) is a multinational data networking and telecommunications equipment company headquartered in Espoo, Finland. It is the world's fourth-largest telecoms equipment manufacturer measured by 2011 revenues (after Ericsson, Huawei and Alcatel-Lucent).[23] It has operations in around 150 countries.[24]

The NSN brand identity was launched at the 3GSM World Congress in Barcelona in February 2007 as a joint venture between Nokia (50.1%) and Siemens (49.9%), but is now a wholly owned subsidiary of Nokia.[25] It provides wireless and fixed network infrastructure, communications and networks service platforms, as well as professional services to operators and service providers.[26] It focuses on GSM, EDGE, 3G/W-CDMA, LTE and WiMAX radio access networks; core networks with increasing IP and multiaccess capabilities and services.

In July 2013, Nokia bought back all shares in Nokia Siemens Networks for a sum of US$2.21 billion and renamed it to Nokia Networks.[27]

Here[edit]

Main article: Here (Nokia)

Here is responsible for Nokia's suite of navigation services (formerly under the Ovi and Nokia brand).[28]

Here's map data originated in Navteq, a Chicago, Illinois-based provider of digital map data and location-based content and services for automotive navigation systems, mobile navigation devices, Internet-based mapping applications, and government and business solutions. Navteq was acquired by Nokia on October 1, 2007.[29] Navteq's map data became part of the Here Maps online service where users can download maps, use voice-guided navigation and other context-aware web services.[26]

Nokia Technologies[edit]

Main article: Nokia Technologies

Nokia Technologies develops and licenses innovations and the Nokia brand.[30]

Nokia technologies consists of an advanced development team. The development is done in wide areas from imaging, sensing, wireless connectivity, power management and advanced materials. Other areas are the expansion of IP licensing program.

Nokia technologies also provides public participation in its development through a program Invent with Nokia.[31]

In November 2014, Nokia technologies launched N1, an Android 5.0 tablet manufactured by Foxconn, as its first product following the Microsoft sale.[13]

Corporate affairs[edit]

Corporate governance[edit]

The control and management of Nokia is divided among the shareholders at a general meeting and the Nokia Leadership Team (left),[32] under the direction of the board of directors (right).[33] The chairman and the rest of the Nokia Leadership Team members are appointed by the board of directors. Only the Chairman of the Nokia Leadership Team can belong to both the board of directors and the Nokia Leadership Team. The board of directors' committees consist of the Audit Committee,[34] the Personnel Committee[35] and the Corporate Governance and Nomination Committee.[36][37]

The operations of the company are managed within the framework set by the Finnish Companies Act,[38] Nokia's Articles of Association[3] and Corporate Governance Guidelines,[39] and related board of directors adopted charters.

Nokia Leadership Team (as of May 2015)[32]
Rajeev Suri (Chairman), b. 1967
President and CEO since 1 May 2014
Joined Nokia on 1995

Samih Elhage
Executive Vice President and Chief Financial and Operating Officer of Nokia Networks
Joined Nokia Networks 2012
Sean Fernback, b. 1964
President of Here
Joined Nokia 2006, Nokia Leadership Team member since 1 July 2011
Ramzi Haidamus, b.
President of Nokia Technologies
Timo Ihamuotila, b. 1966
Executive Vice President and Group Chief Financial Officer
With Nokia 1993–1996, rejoined 1999, Nokia Leadership Team member since 2007
Board of directors[33]
Risto Siilasmaa (Chairman), b. 1966
Board member since 2008, Chairman of the board of directors since 3 May 2012
Chairman of the Corporate Governance and Nomination Committee
Founder and Chairman of F-Secure Corporation
Jouko Karvinen (Vice chairman), b. 1957
Board member since 3 May 2011, Chairman of the Audit Committee, Member of the Corporate Governance and Nomination Committee
CEO of Stora Enso Oyj
Vivek Badrinath, b. 1969

Deputy Chief Executive Officer, Accor Group
Bruce Brown, b. 1958
Board member since 3 May 2012, Member of the Personnel Committee
Chief Technology Officer of Procter & Gamble
Elizabeth Doherty, b. 1957
Board member since May 2013
independent director
Mårten Mickos, b. 1962
Board member since 3 May 2012
chief executive officer of Eucalyptus Systems, Inc.
Elizabeth Nelson, b. 1960
Board member since 3 May 2012, Member of the Audit Committee
Independent Corporate Advisor
Kari Stadigh, b. 1955
Board member since 3 May 2011, Member of the Personnel Committee
Group CEO and President of Sampo plc
Dennis F. Strigl, b. 1946

Retired CEO, Verizon Wireless, Author and Consultant

Former corporate officers[edit]

Chief executive officers Chairmen of the board of directors[40]
Björn Westerlund 1967–1977   Lauri J. Kivekäs 1967–1977  Simo Vuorilehto 1988–1990
Kari Kairamo 1977–1988 Björn Westerlund  1977–1979 Mika Tiivola 1990–1992
Simo Vuorilehto 1988–1992 Mika Tiivola 1979–1986 Casimir Ehrnrooth  1992–1999
Jorma Ollila 1992–2006 Kari Kairamo 1986–1988 Jorma Ollila 1999–2012
Olli-Pekka Kallasvuo  2006–2010
Stephen Elop  2010–2013

Stock[edit]

Nokia is a public limited liability company and is the oldest company listed under the same name on the Helsinki Stock Exchange, beginning in 1915.[41] Nokia has had a secondary listing on the New York Stock Exchange since 1994.[4][41] Nokia shares were delisted from the London Stock Exchange in 2003, the Paris Stock Exchange in 2004, the Stockholm Stock Exchange in 2007 and the Frankfurt Stock Exchange in 2012.[42]

In 2007, Nokia had a market capitalisation of €110 billion; by July 17, 2012 this had fallen to €6.28 billion; by 23 February 2015, the market cap had increased to €26.07 billion.

Corporate culture[edit]

Nokia's official corporate culture manifesto, The Nokia Way, emphasises the speed and flexibility of decision-making in a flat, networked organization.[43]

The official business language of Nokia is English. All documentation is written in English, and is used in official intra-company spoken communication and e-mail.

In May 2007, Nokia redefined its values after initiating a series of discussions worldwide as to what the new values of the company should be. Based on the employee suggestions, the new values were defined as: Engaging You, Achieving Together, Passion for Innovation and Very Human.[43]

Headquarters[edit]

The Nokia House, Nokia's head office located by the Gulf of Finland in Keilaniemi, Espoo, was constructed between 1995 and 1997. It was the workplace of more than 1,000 Nokia employees.[41]

The Nokia House was the head office building of Nokia Corporation, located in Keilaniemi, Espoo, just outside Helsinki, the capital of Finland. The two most southern parts of the building were built in the early 1990s and the third most northern part was built in 2000. Around 5000 employees work in the premises.

On December 2012, Nokia announced that it has sold its head office building to Finland-based Exilion for €170 million and leasing it on a long term basis.[44]

The building was sold to Microsoft as a part of sale of mobile phone business in April 2014. The building was renamed to Microsoft Talo.[45][46]

After the sale, Nokia has its headquarters in Karaportti, Espoo, Finland.[47]

Logos[edit]

Controversies[edit]

NSN's provision of intercept capability to Iran[edit]

In 2008, Nokia Siemens Networks, a joint venture between Nokia and Siemens AG, reportedly provided Iran's monopoly telecom company with technology that allowed it to intercept the Internet communications of its citizens.[51] The technology reportedly allowed Iran to use deep packet inspection to read and even change the content of everything from "e-mails and Internet phone calls to images and messages on social-networking sites such as Facebook and Twitter". The technology "enables authorities to not only block communication but to monitor it to gather information about individuals, as well as alter it for disinformation purposes,".

During the post-election protests in Iran in June 2009, Iran's Internet access was reported to have slowed to less than a tenth of its normal speeds, and experts suspected this was due to the use of the interception technology.[52]

In July 2009, Nokia began to experience a boycott of their products and services in Iran. The boycott was led by consumers sympathetic to the post-election protest movement and targeted at those companies deemed to be collaborating with the Islamic regime. Demand for handsets fell and users began shunning SMS messaging.[53]

The joint venture company, Nokia Siemens Networks, asserted in a press release that it provided Iran only with a 'lawful intercept capability' "solely for monitoring of local voice calls". "Nokia Siemens Networks has not provided any deep packet inspection, web censorship or Internet filtering capability to Iran," it said.[54]

Lex Nokia[edit]

In 2009, Nokia heavily supported a law in Finland that allows companies to monitor their employees' electronic communications in cases of suspected information leaking.[55] Contrary to rumors, Nokia denied that the company would have considered moving its head office out of Finland if laws on electronic surveillance were not changed.[56] The Finnish media dubbed the law Lex Nokia because it was implemented as a result of Nokia's pressure.

The law was enacted, but with strict requirements for implementation of its provisions. Until February 2013, no company had used its provisions. In 25 February the Office of Data Protection Ombudsman confirmed that city of Hämeenlinna had recently given the required notice.[57]

Nokia–Apple patent dispute[edit]

In October 2009, Nokia filed a lawsuit against Apple Inc. in the U.S. District Court of Delaware claiming that Apple infringed on 10 of its patents related to wireless communication including data transfer.[58] Apple was quick to respond with a countersuit filed in December 2009 accusing Nokia of 11 patent infringements. Apple's General Counsel, Bruce Sewell went a step further by stating, "Other companies must compete with us by inventing their own technologies, not just by stealing ours." This resulted in an ugly spat between the two telecom majors with Nokia filing another suit, this time with the U.S. International Trade Commission (ITC), alleging Apple of infringing its patents in "virtually all of its mobile phones, portable music players, and computers."[59] Nokia went on to ask the court to bar all U.S. imports of the Apple products including the iPhone, Mac and the iPod. Apple countersued by filing a complaint with the ITC in January 2010.[58]

In June 2011, Apple settled with Nokia and agreed to an estimated one time payment of $600 million and royalties to Nokia.[60] The two companies also agreed on a cross-licensing patents for some of their patented technologies.[61][62]

Alleged tax evasion in India[edit]

Nokia's Indian subsidiary has been charged with non-payment of TDS and transgressing transfer pricing norms in India.[63] The unpaid TDS of 30 billion, accrued during a course of six years, was due to royalty paid by the Indian subsidiary to its parent company.[64]

See also[edit]

  • Sailfish OS – Continuation of MeeGo through Nokia's bridge program.
  • Twig Com - a company started by a former manager of Nokia mobile phones section in 1988.
  • Jolla – a company started by former Nokia employees which owns Sailfish OS.
  • Newkia – Singapore-based company founded by ex-Nokia executive.
  • Microsoft Mobile – The re-branding of Nokia Device and Services division after acquired by Microsoft.
  • History of Nokia

References[edit]

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Further reading[edit]

Title Author Publisher Year Length ISBN
The Decline and Fall of Nokia David J. Cord Schildts & Söderströms April 2014 304 pp ISBN 978-951-52-3320-2
Winning Across Global Markets: How Nokia Creates Strategic Advantage in a Fast-Changing World Dan Steinbock Jossey-Bass / Wiley May 2010 304 pp ISBN 978-0-470-33966-4
Nokia: The Inside Story Martti Häikiö FT / Prentice Hall October 2002 256 pp ISBN 0-273-65983-9
Work Goes Mobile: Nokia's Lessons from the Leading Edge Michael Lattanzi, Antti Korhonen, Vishy Gopalakrishnan John Wiley & Sons January 2006 212 pp ISBN 0-470-02752-5
Mobile Usability: How Nokia Changed the Face of the Mobile Phone Christian Lindholm, Turkka Keinonen, Harri Kiljander McGraw-Hill Companies June 2003 301 pp ISBN 0-07-138514-2
Business The Nokia Way: Secrets of the World's Fastest Moving Company Trevor Merriden John Wiley & Sons February 2001 168 pp ISBN 1-84112-104-5
The Nokia Revolution: The Story of an Extraordinary Company That Transformed an Industry Dan Steinbock AMACOM Books April 2001 375 pp ISBN 0-8144-0636-X

External links[edit]