Abstract
On August 8, 2007, leading international mobile phone vendor Nokia announced
that it was adjusting its long-standing IC development model based on in-house
R&D to make greater use of technology licensing and multi-sourcing. This
indicates a concrete manifestation of a change in Nokia' s strategy that has
been forced on the company by changes in the mobile phone industry
environment. Nokia has been collaborating with Texas Instruments for some
years now; it has now also begun to adopt IC solutions supplied by STM,
Broadcom, and Infineon. A few days after Nokia' s announcement, on August 20,
Infineon revealed that it was acquiring LSI' s mobile products division for 330
million Euros. These two announcements have sent shockwaves through the mobile
phone IC market. This report will examine the strategic thinking behind
Nokia' s change in strategy, and will consider how the new strategy will affect
the competitive balance in the global mobile phone IC industry.
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