Siemens Boots Nokia (Again)

Siemens AG (NYSE: SI; Frankfurt: SIE) has again snatched a 3G network contract from under the nose of Finnish rival Nokia Corp. (NYSE: NOK), this time securing a €300 million (US$366 million) deal with Italian carrier Wind Telecomunicazioni SpA.

The German vendor today announced it has been chosen as a radio access network (base station) supplier for Wind’s UMTS (Universal Mobile Telecommunications System) network (see Siemens Wins at Wind).

According to EMC, Wind is the third largest carrier in Italy, with an 18 percent market share and 10.2 million subscribers as of the end of the first quarter of 2004.

Back in April 2001, Nokia issued a statement declaring that “Wind has chosen Nokia as its strategic partner to ensure the network’s fast deployment and effective launch of UMTS service in Italy.”

Nokia is keen to play down the loss. “We were a supplier for the minor part [of the network],” a spokeswoman tells Unstrung. “It was a commercial decision by Wind, rather than a technical one.”

LM Ericsson (Nasdaq: ERICY) is the supplier of the carrier’s core network equipment.

Today’s deal is not the first time Nokia has been ousted from a 3G contract win by Siemens.

“It is interesting to see that lately Nokia has lost three major W-CDMA contracts that they originally announced in 2000 or 2001, and all of them (Telefònica Spain, NetCom AS, and Wind) were lost to Siemens,” notes Kaupthing Bank analyst Esa Nurkka (see Siemens Wins 3G Deals and Siemens Steals Nokia Deal).

UMTS is the 3G upgrade to the GSM (Global System for Mobile communications) standard, using a wideband-CDMA (W-CDMA) air interface on top of the core GSM network to increase voice capacity and boost data-transfer speeds to a touted 2 Mbit/s.

— Justin Springham, Senior Editor, Europe, Unstrung