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Backhaul

Italians Rage at NSN

3:40 PM -- Nokia Networks always knew that downsizing in Europe was going to be a tough process.... (See NSN's Rajeev Suri: Restructuring, Research & Resilience .)

Italian union Federazione Impiegati Operai Metallurgici (FIOM) is seeking government intervention over NSN's plans to lay off more than half of its staff in the southern European country.

As part of its massive restructuring program, NSN told the union it intends to cut more than 580 jobs from a total workforce in Italy of 1,100. (See NSN Could Lose More Than 17,000 Staff.)

In a statement on its website, FIOM urges (in Italian) the country's Minister of Economic Development, Corrado Passera, to get involved, call a crisis meeting and tackle technology sector job losses that the union deems "unacceptable."

The union also claims that the number of job losses is higher than expected because NSN, following a revamp of its asset divestment agreement, is no longer handing over its Milan-based mobile backhaul business to DragonWave Inc. (AIM/Toronto: DWI; Nasdaq: DRWI) as part of the sale agreed in November 2011. (See DragonWave to Buy NSN Unit.)

The amended deal means DragonWave will still take on 130 NSN staff in China but not the 231 backhaul product staff employed by NSN in Milan. (See DragonWave Amends NSN Deal.)

That means less cost for DragonWave, which is currently struggling with low revenues and quarterly net losses, but more hassle for NSN. (See DragonWave to Come Up Short in Q4.)

— Ray Le Maistre, International Managing Editor, Light Reading

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