Nokia to outsource phone chipsets, frees up R&D resources

Nokia announced a change in its business model. The firm says it will increase outsourcing of its chipsets for key mobile phone technologies in order to save costs and free up R&D resources for new projects.

Niklas Savander, head of Nokia's technology platforms unit, told a Q&A session that he believes that the new strategy will 'foster more innovation and competitive pricing in the industry', whilst freeing up the group's own R&D resources.

'We see that (the industry) is consolidating around a few key players...We believe that the actions we are announcing today will have an influence on this industry structure in the future,' he said.

The company has made a deal with STMicroelectronics for modem technology and would like to license the technology to other players too. Nokia also made a non-exclusive supply agreement with Broadcom for standard EDGE chipsets and is in talks with Texas Instruments over the supply of custom-made EDGE chipsets.

The firm also announced that about 200 Nokia employees in Finland and the U.K. will be transferred to STMicroelectronics.