Nokia Siemens Networks to enter energy sector

Nokia Siemens is to expand market share after major cost cuts

Telecommunications equipment supplier Nokia Siemens Networks has announced plans to expand its business into the energy sector.

"In early 2008 we made a strategic decision to focus more on cash flow and profitability than on market share. Now it's time to give it up and to focus solely on the market share,” chief executive Rajeev Suri told the Finnish paper Helsingin Sanomat on Sunday.

The company today said it will launch a new unit that will target its existing charging, mediation, service management and network management solutions at energy providers. The unit, which will operate within Nokia Siemens Networks' recently launched Business Solutions division, will start work on 1 January 2010.

“When you look at what is required to manage power grids, or to make full use of unpredictable renewable energy sources such as solar and wind, as well as bringing greater transparency and flexibility to billing, the synergies with the core of our existing telecoms business is obvious,” said Juhani Hintikka, Nokia Siemens Networks head of operations and business software.

“While our research and development remains focused on communication service providers, we will look to exploit opportunities where we can create clear value for our customers by entering new growing markets with our current products and services."

Nokia Siemens Networks also said today that it will team up with software company ServusNet to help wind power operations optimise power generation and delivery.

The news follows the company setting a goal earlier this month to reduce annual operating expenses and production overheads by €500m by the end of 2011 by cutting costs and nearly 6,000 jobs. Nokia Siemens Networks has struggled to make a profit in the past two years.