With just 23 shopping days left 'til Christmas, industry analysts are speculating furiously about what might be in
Nokia Corp.'s (NYSE: NOK) letter to fellow countryman
Santa Claus.
So far, Code Division Multiple Access (CDMA) infrastructure players
Airvana Inc.,
AirWalk Communications Inc., and
InterWave Communications International Ltd. (Nasdaq: IWAV) are the names bubbling in the rumor pot.
The specter of a Nokia acquisition attack was raised last week by the vendor's surprise admission that it is considering a move into the CDMA network world – despite being traditionally associated with a market-leading position in the European-backed GSM (Global System for Mobile communications) and UMTS (Universal Mobile Telecommunications Service) sectors (see
Nokia Mulls CDMA Move).
Analysts differ over potential strategies for such a move, but all are agreed on one thing: The vendor will
have to purchase a CDMA market player to have a chance of success.
"An acquisition would be essential for Nokia," comments
Gartner Inc. principal analyst Jason Chapman. "Trying to build up from a non-starting position would be particularly tough."
With
Current Analysis' senior wireless infrastructure analyst, Peter Jarich, stating that "it's unlikely Nokia would be able to acquire a market leader," it seems the vendor will be forced to target a smaller player. But which?
CDMA network startup Airvana is mooted by
Unstrung's research analyst Gabriel Brown as a potential acquisition candidate. Founded in March 2000, Airvana builds Radio Access Network (RAN) infrastructure based on the CDMA2000 1xEV-DO 3G wireless standard and an all-IP architecture.
Brown cites its private status, combined with Nokia’s similar all-IP network philosophy, as catalysts for an acquisition (see
Nokia Claims Intelligence and
Trying to Do the DO). "An Airvana deal could make some sense on paper."
Such a move, however, would have to overcome Airvana’s relationship with Nokia rivals
Nortel Networks Corp. (NYSE/Toronto: NT) and
LM Ericsson (Nasdaq: ERICY), both of which have struck agreements with the startup to outsource development of an EV-DO module. These relationships, warns Brown, "would be a big hurdle."
As for Texas-based startup Airwave and Silicon Valley's InterWave Communications: "These vendors would be an easier acquisition to engineer [as opposed to an incumbent vendor]... and they look to be targeting some developing-world opportunities, which would fit in with a potential Nokia strategy," argues Current Analysis' Jarich (see
InterWave Wins Iraq Deal and
InterWave Wins in Nigeria).
A "spread-spectrum" digital cellular air interface technology mainly used in the U.S. and South Korea, CDMA operates in the 800MHz band and 1.9GHz PCS band and supports data-transfer speeds between 14.4 kbit/s and about 2 Mbit/s (in its latest 3G variants).
— Justin Springham, Senior Editor, Europe,
Unstrung
