Nokia Revamps Chip Strategy

ESPOO, Finland -- Nokia today announcedthat it is introducing a licensing andmultisourcing model for its chipset strategy. This will allow Nokia to focuson its core competencies in chipset development, leverage externalinnovation, and foster competition in the chipset industry. Under thisrenewed strategy Nokia will discontinue parts of its own chipset developmentand expand its use of commercially available chipsets.

Nokia will however continue to develop its leading modem technology*,which includes protocol software and related digital design for WCDMA/GSMandits evolution. Nokia will then license this modem technology to its chipsetmanufacturers, who will use it in the chipsets they develop and produce forNokia and - if they so decide - in the chipsets they produce for the openmarket.

This licensing and multisourcing strategy will allow Nokia to broadenitspool of chipset suppliers and leverage external innovation to support itswide range of products. It will also allow Nokia to focus on its corecompetence in modem technology and invest in R&D areas besides radiotechnology, such as in software to power internet services.

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

Based on this renewed strategy, Nokia is now working with four chipsetsuppliers. Texas Instruments continues to be a broad scope supplier acrossall protocols, Broadcom has been chosen as a supplier in EDGE, InfineonTechnologies as a supplier in GSM, and STMicroelectronics as a supplier in3G.

Nokia Corp. (NYSE: NOK)