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Tuesday, April 21, 2015

Nokia bets software revolution will help avoid past merger errors, (NYSE: ALU)

Nokia's acquisition of smaller rival Alcatel-Lucent may avoid the pitfalls that befell earlier telecom network equipment marriages, thanks to a revolution over the past decade in how products are launched and developed.The brains and brawn of telecom networks today lie in software, which is programmable and flexible, and not in customised hardware as in the past. Products are more modular with open interfaces that allow equipment from different manufacturers to talk to each other.That should make it quicker and cheaper to combine the two companies' products, analysts and telecom executives said, and may help Nokia succeed where other acquisitions have struggled.Nokia has promised 900 million euros ($960 million) of cost savings by 2019 from the Alcatel-Lucent acquisition, which is set to be completed in the first half of next year.

Alcatel Lucent SA is a France based company that proposes solutions used by service providers, businesses, and governments worldwide to offer voice, data, and video services to their own customers. Shares of ALU traded higher by 4.13% or $0.16/share to $4.03. In the past year, the shares have traded as low as $2.28 and as high as $4.96. On average, 10370700 shares of ALU exchange hands on a given day and today's volume is recorded at 10410199.