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Cisco Going Mobile, Acquiring Nokia?
Keruo writes "Sunday Business paper is reporting on its latest issue that Cisco Systems is considering of acquiring some large player in the mobile telephone field. According to a Reuters article the paper also suggests that the company is most likely Nokia. Neither of the companies have yet commented on the rumour." From the article: "Cisco's mainstay networking market was fast changing with the convergence of fixed-line and wireless networks, and Cisco needed a merger to acquire the technology to create intelligent wireless applications, which Finnish-based Nokia could provide."
This would be their first really big acquisition in a long time, perhaps a bit too big for them?
-1, especulative
This article has no real content as the source of the information is unrevealed and both companies refused to comment. The real story is that large corporations have departments that work on plausible mergers/acquisitions day and night on future moves. They create possible mergers day and night, and will continue to do so after this. Without actual information, this article is fluff at best. The intresting part is the effects of this merger upon the technological fields.
This seems to be a story that started out from a single source. All the articles in Google news seem to quote each other and none of them seem to know where the original reference is (probably some analyst has started it as a way to boost his holdings). Now Reuters has picked it up. Excpect some nice trading on Monday when first Helsinki stock exchange and NASDAQ later open up. Then everyone forgets about this two days later.
Big, slowly dying behemoth of a company notices that its customers are gradually beginning to realize it's no longer really doing much of anything for them. Big, slowly dying behemoth immediately looks around for some other area it can branch out into so that it can run over there and escape before it pisses away all of its brand recognition in its entrenched area. Big, slowly dying behemoth immediately notices up-and-coming, vibrant technology company in an expanding area, and seeks to buy it, so that it can gradually ruin the vibrant company by marrying it to its entrenched, slowly dying management style.
Still though, some good might come of this. The first thing that comes to mind when I see a router company buying a cell phone company is "wimax routers". It would be the most logical thing to do once you own technology in both of those spaces. Of course, that would require imagination and vision. Does Cisco have those?
yay for finnish intelligence !
I couldn't find any data on what these companies are WORTH to see how easily Cisco could acquire Nokia, but Nokia revenues for 2004 were at 29.3 billion euro whilst Cisco revenues were at 22 billion euro. I am not exactly sure Cisco could swallow Nokia and not choke on it big time.
And all because Mike Wynn has a nokia phone - I think this attempt at silencing him has gotten a little out of hand.
Actually, I'd believe more the other way around...
Given that attempting to silence honest security research is a form of lying, perhaps they'll change the name to Pinokia?
Other than just becomming a conglomerate, I don't see much point. Wireless like Nokia does and network like Cisco does are just too different at this point. So unless they were going to use it for a big push at becomming the dominate VOIP provider (hardware wise), I can't really see it. This could endup as another AOL/TimeWarner in some ways.
That said, it doesn't make that much difference to me. If they can get Sprint (my cell provider) to carry Nokia/Cisco phones (un-crippled) then I'll be happy. Otherwise it won't mean that much to me personally.
But what would we call them? Nisco? Cikia? Nokisco? Just don't see a good name. Not like Squeenix (Square-Enix, or at least as I like to call 'em because it sounds better).
Comment forecast: Bits of genius surrounded by a sea of mediocrity.
We cannot see how this wouldn't work. Think of the synergies and the long-term return on shareholder equity.
It's a cinch that this deal will produce unflappable results.
Sincerely,
AOL and Time-Warner
Wouldn't that be Finland-based? Or did they change their name last night? :P
Nokia's chief of corporate communications Arja Suominen denies the news as unsupported speculation according the Finnish Broadcasting Company YLE.
Nokia has this image as "king of the wireless" but in fact this has been slipping in the last couple of years as their primary product (handset) has been under threat of commoditisation by many other vendors primarily Far-Eastern.
To their credit Nokia saw this coming a long time ago and have strenuously tried to diversify into (a) server-side systems for mobile e.g. specialised mobile groupware and (b) network infrastructure with a security highlight such as dedicated (BSD) firewall boxes and VPN systems.
So maybe they do have something attractive for Cisco and might even view it as a merger.
Trivia: Nokia invented the first non-black Wellington Boot.
"Don't belong. Never join. Think for yourself. Peace." V.Stone, Microsoft Corporation
When cisco acquired linksys, build quality went down the pan. My pre-cicso equipment is solid stuff, built to last. The WRT54G I've got now feels flimsy and from what I've heard from other users is pretty prone to damage.
I'd rather this doesn't happen, as at the moment Nokia is an excellent company that doesn't need messing around with.
couple weeks back I think I remember reading somewhere that that it was vmware that cisco would acquire... this week it's Nokia? What next week?
.. makes me think of routing based on stuff in the app layer. I better patent it .. based on the app layer request (database intensive versus file i/o intensive) .. the router intelligently makes a guess as to the best server to handle the request (taking into consideration which servers have least load).
..I should be able to get a patent, too bad I am posting as AC.
Nokia would make more sense I guess, although I would choose a company with a strong application layer firewall instead. Hmm app layer firewals
Ok I want a patent on this idea which I am sure already sort of exists in some load balancers... still .
It says here that Nokia is considered to be a $71 billion company, vs Cisco $123. Also quotes Cisco's chairman from back in April when he said "I am at the altar waiting to partner" (a reference back then to Nortel Networks, not Nokia)
You know, for a short period of time, we've had a point-to-point network built on open standards. The technology was driven by the academic and research community though. Today, all I read about is how various corporate behemoths are going to introduce next-generation communication products. I have no doubt that every single one of them will do their damnest to make sure that the features they promote work best on their own products, and not so good, if at all, on their competitors'.
We have Internet2, which is ostensibly attempting to move academic/research interests forward. Anyone been chomping at the bit to implement what Internet2 has to offer? Didn't think so. Nothing too revolutionary that I can see. They use IPv6 - important maybe, but not exactly groundbreaking. There's Shibboleth, some lamo attempt to use Java to implement things Kerberos has been doing for years, but in an extraordinarily byzantine fashion. I dunno, what else?
So where is this headed? Frankly, I'm a little worried. Everything forward looking communication initiative I've seen has been the product of either Wall Street or Washington. Not good.
Cisco has about $5 billion in cash & short-term investments. Nokia's market cap is $71 billion (and would probably need an offer that values the firm at $80 to $90 billlion to succeed). Even if Cisco liquidates its $11 billion in long-term investments, it can't swing this deal with what it has on hand.
Unless Cisco goes into major debt with a leveraged buyout, they can't afford to buy someone as big as Nokia.
Two wrongs don't make a right, but three lefts do.
Cisco and Nokia used to be the de facto #1 leaders in their market. Nowadays, they are just two struggling behemoths.
I'm not really sure how benefitial such a merger would be. I guess Cisco's plan is to offer vertically integrated solutions, from the networking stuff all the way to the handset. I don't know... might be a bad merger...
Sivaram Velauthapillai
Seeking the meaning of life... @slashdot of all places
LOL AOL,
sincerly,
HP and Compaq
Compaq and DEC
signatures pending - ansa@kos.to - (dont mail there)
nokia builds some shit phones for their cheaper lines. the nokia 3595 is the worst phone ever invented, or pretty much any phone with replacable covers. the buttons die quickly.. my talk key is gone, but my 7 and my 8 are almost dead.
lameness filter thwarted.
Nokia and Cisco are competitors to a degree. Both sell firewall (with straightVPN) and SSL VPN products; the Nokia firewall products being based on Checkpoint's firewall software platform in the main.
Which is where the real competition lies, Cisco PIX versus Checkpoint Firewall-1 (on a variety of hardware platforms).
So if this merger/buyout actually went ahead, it would alter the landscape significantly, and it would be interesting to see how Cisco would spin it.
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Well I guess the interface may change a bit, for example adding a name to my address book: Phone# configure terminal Enter configuration commands, one per line. End with CNTL/Z. Phone(config)# alias exec callbob dial phone.device.213.555.1212 Phone(config)# end Phone# callbob? *callbob="dial phone.device.213.555.1212"
I remember when Cisco bought Selsius to get into the VoIP biz. That seemed like a good idea at the time, and it was in networking hardware (though mostly terminals), closer to Cisco's core competency. How well did it work out for Cisco, its shareholders, and customers?
Nokia makes "network terminals", too, but would this combination really make Cisco better able to exploit the 3G network market than the two companies operating separately?
--
make install -not war
Please Cisco .. nokia .. ..someone .. improve phones .. make it work as an email address like how IM works.
..sort of like a Voice IM .. if the person hasnt a microphone they can type words and it get dictated back to the caller. If the receive hasn't a speaker .. then speech to text or nothing at all (call back later or leave a message).
.. computer and phone .. and the services email, IM, and phone can be integrated and work together. I should be able to check my voicemail via AIM or MSN chat. and also if I am no there when I get an IM or phone call it should store it and make it accessible via web or phone. When my phone rings (oops I forgot it in my office) .. an icon on my computer should flash too simultaneously ... so i can choose to pick it up on my computer with my bluetooth or wired headset instead of cell phone (which I left in office by mistake) .. Also when an IM is sent and I am away it can bring up a personal custom webpage that can be based on who the caller or IM'er is and ask them to leave a text or voice message or even upload a file.
Actually if all a phone did was hook into IM
my point is the devices
There is a lot to improve in phones and computers working together.
I hope Cisco acquires Nokia. Then maybe Cisco can fire the people who design Nokia phones and bring in new people who understand good design. Current Nokia phones suck.
It'll be interesting to see how this affects Nokia's line of FW appliances. I can't see Cisco continuing to sell a line of hardware that customers use to run their competitors' (ie Checkpoint) firewall software. Then again maybe they'd allow Pix to get ported over to the appliances? I'm not holding my breath though.
Yes, my only tool is a hammer. And you're starting to look like a nail.
The newspaper quoted by Reuters and MarketWatch appears to be the UK newspaper "The Business" (formerly named "Sunday Business").
They'll just offer Cisco stock or something.
Cisco's float is virtually 100%, they don't have any treasury stock they can issue. That is, Cisco doesn't own any Cisco shares to play with. Unless they dilute the current shareholder's stock -- by creating new shares in the joint company to be given to Nokia shareholders -- Cisco doesn't have that many options other than an LBO.
Two wrongs don't make a right, but three lefts do.
I'm willing to bet that the 7920 wireless phones we use in our office are made by Nokia:
Check them out here.
Maybe Cisco wants to push their wireless VOIP to the next level. It makes sense. Imagine every Nokia product being 802.11 VOIP capable right out of the box.
-ted
Nokia, a company that used to make great hardware that has now completely lost the plot insofar as hardware goes.
A merger seems like the natural thing to do at this point.
I find your ideas intriguing and I wish to subscribe to your newsletter.
Nokia does network gear, too. Mostly firewall appliances.
Nokia makes more than cellular phones, they also make things like routers and other networking equipment that compete directly with Cisco.
At my company we have cable manufacturing equipment made by Nokia, and they are also one of our larger customers, buying cables for laying cellular networks.
Cisco's CEO has mentioned on more than one occasion that he does not wish to steer Cisco towards buying any large companies, as the integration and growth potential really does not make sense. Rather, they prefer to buy smaller companies.
As for the rumor, you can see on your favorite financial site (probably the same analyst) that Cisco was purportedly going to buy EMC a few weeks back. Never happened.
The real question for Cisco is what business value and innovation can they bring to Nokia......?? This will prove to be especially difficult due to the large market share they already have. Motorola has a new CEO and is becoming much more innovative and compeitive. So therefore Nokia will have make a quantum leap in innovation in order for Cisco to deliver sufficient shareholder return. One possiblity could be realtime videophone conferencing. Currently they are essentially seperate technologies. In the end I think takover of Nokia by Cisco is unlikely.
End of discussion. Nokia is proud to be finnish and will remain a finnish company. Cisco - go away! You can't just buy anything you like.
Just how many functions can be crammed into a handheld portable device, do you think?
... all of them.
Oh, right
I don't believe the Finnish government would allow it. If Cisco moved Nokia out of Finland (something they would be quite likely to do for tax reasons - income tax in Finland is quite high), it would destroy the Finnish economy.
Nokia has been threatening the government with moving elsewhere for a while - trying to get them to lower income tax.
NOOOOOOOOOOOOO!!!
just when nokia got the hang of linux and did something really good with the n770!!!
now cisco will come along and kill the linux development in favour of its cisco ios (insecure operating system)
oh uhm, right... never mind
It reminds me more of a Siemens from the late nineties.
Cisco is nowhere near big enough to buy out Nokia. What is more likely, is a Sony-Erricsson arrangement...
I thought that Helsinki was the capital of Sweden so it must be Swedish :-)
The worst part is that some people actually believe this... And for some odd reason that Norway is the capital of Sweden??
That's exactly my thoughs on the subject. Ericsson would probably like to get out of the mobile business anyway. Just like Siemens dumped their phones on BenQ.
any way to pump up the value of stock .. you gotta love the rumor mills products..
don't fear the reaper
Wasn't it Siemens that was looking to off-load their loss-making mobile phone business ?
Hmm although this may make some technical sense, I think that you need to consider the companies....
Nokia's Overview shows it to be an old Finish company that moved from a Cable Works company into mobile phones as the market grew.
Cisco's Overview shows it to be a 20 year old company that was set up by a group of American university hackers.
Yes both are large, sell globally, and both know about the bits and pieces that make communications work, however they are 2 very different corporate cultures. We've seen that when Daimler-Benz merged with Chrysler, the clash of cultures resulting in a range of trensions, and new inefficencies. The brash American "can do" and the more planned and calculated German approach, has resutled in the worst of both, rather the best of both companies. Maybe Cisco should look a little closer to home?Cisco doesn't need to acquire a big player in the market. It does no good buying Nokia. It goes like this:
1. Buy small company
2. Stick on Cisco logo
3. ??
4. Profit!!
If it bought a big company, it is bringing in a lot of shareholders, and loosing part of the control. Don't you think Chalmers wants to keep some control over his company?
They didn't outsource, but spun off the non-core businesses. The boots are supposedly the same as ever.
In addition to the rubber boot factory, there's Nokian Tyres(best studded winter tyres available, btw), and the TV set manufacturer Finlux.
Burrrrp!
Yes, and Albany is the capital of Pennsylvania.