6 ms·

Nokia Tries to Reinvent Itself, Again, by Taking Over Alcatel-Lucent

66 points by pavornyoh 11y ago

bitwize 11y ago
For some reason I like the idea of Bell Labs being in the hands of Nokia (not Microkia).
- Simorgh 11y ago
  I like the idea too. However it is worth noting that Bell Labs' hey day was a while back [1]. YC's Request for Startups makes a reference to Bell Labs, 'Bell Labs worked a long time ago but would probably not work in today’s world'. I suppose the key word is 'probably'. No one knows what will happen tomorrow, but certainly Nokia and Bell Labs have their work cut out. [1] http://www.wired.com/2014/09/coupland-bell-labs/ http://www.wired.com/2014/09/coupland-bell-labs/
- dharma1 11y ago
  That's one of the coolest parts of this deal. I hope they make the most of the incredible research at Bell Labs!
  - samfisher83 11y ago
    Bell labs was funded by one of the biggest monopolies ever. I find it hard to believe the new bell labs will have that kind of resources.
  - spinchange 11y ago
    Sadly, Bell Labs really hasn't been the amazing R&D "idea factory" it was known as throughout the 20th century for at least 30 years or more. Alcatel-Lucent is many, many, many generations (and iterations) removed from the same R&D entity that developed the transistor, radar, lasers, communications satellites, wireless telephony, transatlantic cables, etc., etc.
hkmurakami 11y ago
I had no idea they had sold their mapping unit. They bought Navteq in 2007 for $8.1B and sold that to automakers in 2015 for $3.1B [1]. I guess they needed a warchest to have a chance at succeeding in their turnaround (and considering their manufacturing roots, they'd have a hard time having a non-manufacturing-centric identity I imagine), but I'm surprised they couldn't get a higher price tag from a player in the smartphone market. [1] http://www.nytimes.com/2015/08/04/technology/german-carmakers-buy-nokia-mapping-unit-here.html http://www.nytimes.com/2015/08/04/technology/german-carmaker...
- Aoyagi 11y ago
  Well, from what I heard it wasn't profitable. Amusingly enough, the navigation in my Cadillac is now maintained by a company owned by the German car makers.
  - Nux 11y ago
    That used to mean something, now it means something else. ;-)
danieltillett 11y ago
Maybe they should go back to making gumboots [1]. 1. https://en.wikipedia.org/wiki/Nokia https://en.wikipedia.org/wiki/Nokia
- ceduic 11y ago
  They still do, kinda [1]. The footwear business was spun off from the main company in 1990. [2] 1. http://nokianjalkineet.fi/ http://nokianjalkineet.fi/ 2. https://en.wikipedia.org/wiki/Nokian_Footwear https://en.wikipedia.org/wiki/Nokian_Footwear
  - danieltillett 11y ago
    Time to buy it back :)
    - ptaipale 11y ago
      With the unrest growing again in Europe, the good old "Nokia Youth Leader" product line (rubber batons for police) also has a market. http://www.naurulokki.com/kuvat/missa-sana-ei-auta-siella-tarvitaan http://www.naurulokki.com/kuvat/missa-sana-ei-auta-siella-ta... "When words are not enough, you need NOKIA rubber batons" (a genuine advert from 1920's) Knowing a lot of guys in Nokia, they are not too happy about the ALU deal (mostly because of the French connection and experiences) but I see the business sense.
annnnd 11y ago
I think this is a great deal - for Alcatel Lucent. Hardware networking equipment is mostly going to become commodity (with SDN). Some networking equipment will stay expensive, but that will be a smaller market. I don't see what Nokia sees in this deal... On the other hand Nokia can still turn things around once they get back the right to use the name in phones (afaik the name was sold to MS for a limited period). If they stop inventing new OS every month (and stick to stock Android) they could be a huge player.
- mrweasel 11y ago
  >Hardware networking equipment is mostly going to become commodity (with SDN) How is it a commodity? Very few companies are making mobile phone networking equipment. And now one of those few companies is buying another one. That leaves: Nokia, Ericson, Huawei, ZTE and Motorola. If you're a European country or the US, you might not want to buy from two of these.
  - annnnd 11y ago
    I said: ... is mostly going to become commodity ... Speculation of course.
- creshal 11y ago
  Is there really a market for yet another whitebox Android vendor?
  - bad_user 11y ago
    I believe yes, there's plenty of room and making Android phones is the one thing Nokia didn't do. The Lumia line was of great value, my wife received one as a gift, but the one thing we both couldn't stand was the OS. Windows Phone is what killed it.
  - notatoad 11y ago
    No, Nokia just wants to license their brand to some other whitebox Android vendor. They've got a lot of good western brand recognition that can be valuable to one of the Chinese oems on the verge of global expansion.
aianus 11y ago
Why don't public companies ever just give up and cash out the stockholders? It can't imagine what it must feel like to go to work at Blackberry every day just so you can destroy a little more value :/
- cromulent 11y ago
  Why would you "give up" on yearly sales of over 10B and profit over 13%? Seems like a good business to me.
- xorcist 11y ago
  Give up? Because you got one competitor from China? Why don't Cisco just "give up"?
  - darkr 11y ago
    Because they're doing nearly $10B/year in profit on $50B in revenue?
- tajano 11y ago
  I began working at Nokia after they sold the phone business. It's not a place where people were just clocking in and out; there ws a strong effort and opportunity (born of necessity) to innovate. It was exciting. I suppose there are a limited number of examples of big companies with declining market share that successfully turn the ship around, but a few notable examples come to mind. Shareholders can always sell if they don't want to go along for the ride.
- hkmurakami 11y ago
  This is (was?) the largest company in Finland. It employs tens of thousands of people and directly factors into the country's well being. You can't just shut it down in a snap. (sort of like how you can't just sell Blackberry to anyone due to national security reasons)
  - fulafel 11y ago
    This is long past. In the height of the dotcom bubble in 2000 they contributed ~4% to Finland's GDP, but aren't currently very significant. See http://www.wired.co.uk/news/archive/2013-10/04/finland-and-nokia http://www.wired.co.uk/news/archive/2013-10/04/finland-and-n... They do still seem to employ 5000+ in Finland according to their website. And probably left quite some cash in Finland in the company's hey day when global investors got into the stock.
fulafel 11y ago
Previous discussion: https://news.ycombinator.com/item?id=9379582 https://news.ycombinator.com/item?id=9379582
nabla9 11y ago
This looks like well executed deal for good reasons. Nokia and Alcatel-Lucent have little product overlap but significant customer overlap. This deal produces value for their current and future customers. Nokia bought Alcatel-Lucent cleanly. It was not merge or fusion. Some managers are kept, but Nokia is clearly in charge.
deleted 11y ago
[deleted]

66 points by pavornyoh 11y ago

bitwize 11y ago

For some reason I like the idea of Bell Labs being in the hands of Nokia (not Microkia).

Simorgh 11y ago
I like the idea too. However it is worth noting that Bell Labs' hey day was a while back [1]. YC's Request for Startups makes a reference to Bell Labs, 'Bell Labs worked a long time ago but would probably not work in today’s world'. I suppose the key word is 'probably'. No one knows what will happen tomorrow, but certainly Nokia and Bell Labs have their work cut out. [1] http://www.wired.com/2014/09/coupland-bell-labs/ http://www.wired.com/2014/09/coupland-bell-labs/
dharma1 11y ago
That's one of the coolest parts of this deal. I hope they make the most of the incredible research at Bell Labs!
- samfisher83 11y ago
  Bell labs was funded by one of the biggest monopolies ever. I find it hard to believe the new bell labs will have that kind of resources.
- spinchange 11y ago
  Sadly, Bell Labs really hasn't been the amazing R&D "idea factory" it was known as throughout the 20th century for at least 30 years or more. Alcatel-Lucent is many, many, many generations (and iterations) removed from the same R&D entity that developed the transistor, radar, lasers, communications satellites, wireless telephony, transatlantic cables, etc., etc.

hkmurakami 11y ago

I had no idea they had sold their mapping unit. They bought Navteq in 2007 for $8.1B and sold that to automakers in 2015 for $3.1B [1]. I guess they needed a warchest to have a chance at succeeding in their turnaround (and considering their manufacturing roots, they'd have a hard time having a non-manufacturing-centric identity I imagine), but I'm surprised they couldn't get a higher price tag from a player in the smartphone market. [1] http://www.nytimes.com/2015/08/04/technology/german-carmakers-buy-nokia-mapping-unit-here.html http://www.nytimes.com/2015/08/04/technology/german-carmaker...

Aoyagi 11y ago
Well, from what I heard it wasn't profitable. Amusingly enough, the navigation in my Cadillac is now maintained by a company owned by the German car makers.
- Nux 11y ago
  That used to mean something, now it means something else. ;-)

danieltillett 11y ago

Maybe they should go back to making gumboots [1]. 1. https://en.wikipedia.org/wiki/Nokia https://en.wikipedia.org/wiki/Nokia

ceduic 11y ago
They still do, kinda [1]. The footwear business was spun off from the main company in 1990. [2] 1. http://nokianjalkineet.fi/ http://nokianjalkineet.fi/ 2. https://en.wikipedia.org/wiki/Nokian_Footwear https://en.wikipedia.org/wiki/Nokian_Footwear
- danieltillett 11y ago
  Time to buy it back :)
  - ptaipale 11y ago
    With the unrest growing again in Europe, the good old "Nokia Youth Leader" product line (rubber batons for police) also has a market. http://www.naurulokki.com/kuvat/missa-sana-ei-auta-siella-tarvitaan http://www.naurulokki.com/kuvat/missa-sana-ei-auta-siella-ta... "When words are not enough, you need NOKIA rubber batons" (a genuine advert from 1920's) Knowing a lot of guys in Nokia, they are not too happy about the ALU deal (mostly because of the French connection and experiences) but I see the business sense.

annnnd 11y ago

I think this is a great deal - for Alcatel Lucent. Hardware networking equipment is mostly going to become commodity (with SDN). Some networking equipment will stay expensive, but that will be a smaller market. I don't see what Nokia sees in this deal... On the other hand Nokia can still turn things around once they get back the right to use the name in phones (afaik the name was sold to MS for a limited period). If they stop inventing new OS every month (and stick to stock Android) they could be a huge player.

mrweasel 11y ago
>Hardware networking equipment is mostly going to become commodity (with SDN) How is it a commodity? Very few companies are making mobile phone networking equipment. And now one of those few companies is buying another one. That leaves: Nokia, Ericson, Huawei, ZTE and Motorola. If you're a European country or the US, you might not want to buy from two of these.
- annnnd 11y ago
  I said: ... is mostly going to become commodity ... Speculation of course.
creshal 11y ago
Is there really a market for yet another whitebox Android vendor?
- bad_user 11y ago
  I believe yes, there's plenty of room and making Android phones is the one thing Nokia didn't do. The Lumia line was of great value, my wife received one as a gift, but the one thing we both couldn't stand was the OS. Windows Phone is what killed it.
- notatoad 11y ago
  No, Nokia just wants to license their brand to some other whitebox Android vendor. They've got a lot of good western brand recognition that can be valuable to one of the Chinese oems on the verge of global expansion.

aianus 11y ago

Why don't public companies ever just give up and cash out the stockholders? It can't imagine what it must feel like to go to work at Blackberry every day just so you can destroy a little more value :/

cromulent 11y ago
Why would you "give up" on yearly sales of over 10B and profit over 13%? Seems like a good business to me.
xorcist 11y ago
Give up? Because you got one competitor from China? Why don't Cisco just "give up"?
- darkr 11y ago
  Because they're doing nearly $10B/year in profit on $50B in revenue?
tajano 11y ago
I began working at Nokia after they sold the phone business. It's not a place where people were just clocking in and out; there ws a strong effort and opportunity (born of necessity) to innovate. It was exciting. I suppose there are a limited number of examples of big companies with declining market share that successfully turn the ship around, but a few notable examples come to mind. Shareholders can always sell if they don't want to go along for the ride.
hkmurakami 11y ago
This is (was?) the largest company in Finland. It employs tens of thousands of people and directly factors into the country's well being. You can't just shut it down in a snap. (sort of like how you can't just sell Blackberry to anyone due to national security reasons)
- fulafel 11y ago
  This is long past. In the height of the dotcom bubble in 2000 they contributed ~4% to Finland's GDP, but aren't currently very significant. See http://www.wired.co.uk/news/archive/2013-10/04/finland-and-nokia http://www.wired.co.uk/news/archive/2013-10/04/finland-and-n... They do still seem to employ 5000+ in Finland according to their website. And probably left quite some cash in Finland in the company's hey day when global investors got into the stock.

fulafel 11y ago

Previous discussion: https://news.ycombinator.com/item?id=9379582 https://news.ycombinator.com/item?id=9379582

nabla9 11y ago

This looks like well executed deal for good reasons. Nokia and Alcatel-Lucent have little product overlap but significant customer overlap. This deal produces value for their current and future customers. Nokia bought Alcatel-Lucent cleanly. It was not merge or fusion. Some managers are kept, but Nokia is clearly in charge.

deleted 11y ago

[deleted]