Finnish telco giant Nokia has inked a three-year frame
agreement with Belgium’s Belgacom Mobile to supply of a complete
radio-access and packet core network for the Proximus brand in Belgium.
The pact expands on an earlier deal between Nokia and Belgacom which began
in 1996 when the mobile phone operator became Proximus’s GSM
supplier. Nokia is already delivering its GPRS
to the Belgian company. Those contracts have been valued at about US$177
million.
The good news of the contract win comes as Nokia cut its sales guidance for
the second half of 2002 and warned there were no signs of improvement in the
battered telecommunications sector. Nokia is projecting year-over-year sales
growth of approximately 10 percent, 5 percent lower than previous forecasts.
There is little doubt Nokia announced its Belgacom contract expansion to
help cushion the blow expected from the gloomy earnings forecasts. It also
comes just weeks after rival Motorola announced four
contracts valued at US$100 million to expand and upgrade GSM networks to
expand China Mobile’s GSM networks in the provinces of Hubei, Yunnan and the
cities of Beijing and Tianjin.
Nokia it would provide a full range of GSM radio-access network
infrastructure and operational support systems equipment to Proximus, which
is co-owned by Belgacom and Vodafone. GSM uses narrowband TDMA
It said deliveries have already started and will continue over the next
three years, based on Proximus’ needs.
Separately, Nokia CEO Jorma Ollila said the company was in no rush to jump
into a massive acquisition deal to add to its mobile business worldwide.
According to reports Ollila told a company strategy meeting it was very
difficult to merge technology companies in this environment.
“I don’t think there has ever been a successful merger of two companies in
the hi-tech area. There’s a good reason why that is. The legacy of propriety
technology is very difficult to merge and the corporate culture does matter
in technology companies, perhaps more than others,” he said.