The world’s largest phone maker has announced that it is essentially getting out of the business of making phones for CDMA cellular-wireless networks.
Earlier this year, Nokia announced that it was forming a partnership with Sanyo to develop CDMA phones, but it recently announced it was pulling out of the deal.
“We feel it would not be in our best interests to make an agreement that proved to be less beneficial than originally anticipated,” said Kai Oistamo, Executive Vice President, Nokia, Mobile Phones. “After exploring all available opportunities and making every effort to create a sustainable CDMA business, this is our only viable option.”
Nokia did say it wasn’t completely abandoning the CDMA business in the U.S. and other key markets. It will still release a few phones using this standard, but the development and manufacture of these will be totally outsourced.
The company plans to ramp down its own CDMA R&D and manufacturing by April of next year. It will switch its product development infrastructure currently devoted to CDMA to more profitable parts of its business.
Why the Change?
CDMA is popular in the United States and a few other countries, but most of the world uses the GSM standard, where traditionally Nokia has made most of its profits.
Also, any company offering CDMA phones has to pay hefty licensing fees to Qualcomm, which owns patents for much of the technology.
More information is available on Nokia’s web site.