Nokia to cut 7000 jobs in its legacy Symbian activities

Nokia will axe 7,000 jobs and outsource its legacy Symbian activities to slash 1 billion euros ($1.46 billion) of costs as it struggles to compete in the fierce smartphone market.
Nokia, the world's largest phone maker by volume, on Wednesday detailed an overhaul of its business that will include laying off 4,000 staff and transferring another 3,000 to technology services firm Accenture - a total 12 per cent of its phone unit workforce.

Accenture will take over Nokia's legacy Symbian software activities and support future smartphones, including those running on Microsoft's Windows platform.

The deal enables Nokia to cut annual business research and development costs by 1 billion euros, or 18 per cent, by 2013 from 5.65 billion in 2010.

To turn around its fortunes, Nokia unveiled a deal in February to start using Microsoft software instead of its own Symbian platform. Its market share in smartphones has fallen sharply over the past few years as it loses out to Apple and other manufacturers of high-end handsets.

"Restructuring had been widely expected but Nokia will be hoping that the transfer of 3,000 of jobs to Accenture will help cushion the blow as it ramps down its Symbian investments," said Ben Wood, head of research at CCS Insight.

Nokia said most of the 4,000 layoffs will take place in Finland, Denmark and Britain, with all workers staying on the payroll through 2011.

In its native Finland, Nokia will cut 1,400 jobs.

"This went slightly better than expected, because Nokia transfers Symbian development. These 1,400 people to be laid off are mainly MeeGo coders and they should have quite good chances to find new jobs," said Pertti Porokari, chairman of the Union of Professional Engineers in Finland.

Nokia's telecom gear arm Nokia Siemens Networks cut around 9,000 jobs after it started operations in 2007.

Nokia also announced that it will transfer some 3,000 employees worldwide to Accenture as it shifts the development of the Symbian platform, used in Nokia cellphones, to the global technology and outsourcing company.

Nokia says those employees, located in China, Finland, India, Britain and the United States, will continue to develop the software and services for Nokia and ``over time, Accenture and Nokia will seek opportunities to retrain and redeploy transitioned employees.''

Nokia's share price jumped more than 3 percent to ¿6.17 ($9.02) in arly afternoon trading in helsinki.

The announcements came as Nokia, with 13,000 employees in Finland, had called workers for internal meetings in several cities for briefings about company strategy as it begins a new partnership with Microsoft Corp.

In a push to challenge rivals like Apple and Google, Nokia and Microsoft announced in February that they are joining forces in an increasingly competitive environment.

Nokia continues to stiff competition from Research in Motion's Blackberry, Apple's iPhone and Google's Android at the top end of the smartphone market. It has said it plans to cut operating expenses by 1 billion ($1.5 billion) by 2013.