Nokia came out with a news on Wednesday that it has completed a deal to outsource Symbian software development to Accenture and also its going to transfer 2,800 of their workers to the global management-consulting firm.Nokia said Accenture PLC will provide them with software services through 2016 with the personnel transfer expected in October when the deal closes. Half of the workers are based in Finland with another 1,400 workers are in China, India, Britain and the United States.Other than the personnel transfer, Nokia has said it plans to lay off 4,000 people by the end of 2012, mostly in Denmark, Finland and Britain.
This announcement came in notice two months after Nokia came out with a plan with the aim to cut costs by $1.5 billion (euro1 billion) by 2013, including 7,000 global layoffs, and compete with its top rivals in the tough smartphone market.
Nokia’s share price has sunk in past few months and was trading with a near multi-year lows of euro4.23 ($6.08) in early afternoon trading in Helsinki – it has barely changed from Tuesday’s closing rate. From 1998 Nokia has been the biggest seller of cellphones but first quarter of this year seems to be like Apple overtook it as the world’s top handset vendor in revenue terms – reaching sales of $11.9 billion on shipments of 18.6 million devices against Nokia‘s revenue of $9.4 billion on shipments of 108.5 million units.Although Nokia sold 432 million devices in 2010, its more than its three closest rivals all together combined & still its market share continues to fall. At 29 percent in the first quarter, it’s at its lowest level since the late 1990s.
The main problem with Nokia is that its inability to meet modern challenges of the smartphone market, also in Producing a great deal of profit in the handset industry, where Nokia used to be at the peak leading. Although it sold 24 million smartphones in the first quarter, 13 percent more than in 2010, its share in the sector plunged to 24 percent from 39 percent a year earlier.
In February, Nokia announced a major strategy shift when it partnered with Microsoft Corp., saying it will gradually replace Symbian and MeeGo platforms with the Window-based software that will become the main software used in Nokia cellphones.The markets are waiting to see the company’s first Windows Phone. CEO Stephen Elop has said the Windows-based phone will be launched later this year with bulk sales expected in 2012.