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Nokia to axe 600 jobs

Nokia to axe 600 jobs

Nokia is hoping a strategy of concentrating on low-cost 'phones for emerging markets will bring earnings back on track.

The global credit crunch claims another victim with the news that mobile 'phone giant – and recent entrant to the world of open source – Nokia is to lay off up to 600 employees world-wide.

According to BetaNews, the company is looking to save costs by restructuring its sales and marketing operations and to return many core roles to its headquarters in Finland. It's feared that up to 450 people could be heading for an early bath should the plan go ahead.

To reduce costs still further, the company plans to shut down its manufacturing plant in Turku, although at least the 220-strong workforce there will be offered the chance to relocate to similar facilities in Helsinki or Salo rather than blanket mandatory redundancy.

The cuts continue with the Nokia Research Centre, the company's main R&D arm, which is looking to shed approximately 130 employees in order to streamline. Finally, global process operations will be lighter by thirty-five warm bodies when the plans are finalised.

The company does have plans to turn things around, however: the creation of two new low-cost handsets aimed at pushing out mobile 'phone service to previously uncovered areas of India and Africa. The handsets, the 2323 and 2330, will begin life in New Delhi before moving out to other areas of Asia and finally Africa some time next year. The company is also looking to offer farmers in rural areas useful information via their handsets, including crop prices and weather data in order to encourage sales of the new devices.

Although the current climate looks bleak for Nokia, with earnings currently down 28 percent year-on-year, at least it's having a better time than rival Motorola: the company announced last week that around 3,000 jobs would be axed as part of a similar cost-cutting project.

Do you believe that concentrating on low-cost devices for emerging – and struggling – markets is the way Nokia should be going, or is the company better off concentrating on the high-margin top-end handsets for the developed world? Share your thoughts over in the forums.

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