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European Commission Approves Nokia Buying Out Alcatel-Lucent

July 24, 2015 - Written By Ricardo Trevizo

Nokia is an international communications and information technology company with a strong focus on mobile devices. With over 61,656 employees across 120 countries, Nokia has grown exponentially over the past years. Today, the Finnish company has just received the green light from the European Commision to complete the acquisition of the telecoms equipment company Alcatel-Lucent after deliberating for quite some time. The reason behind the European Commission having to approve Nokia’s latest deal with Alcatel-Lucent is that the governmental entity is rather concerned about possible competition concerns. After analyzing the possible outcomes of this new merge, the European Commission stated that Nokia buying Alcatel-Lucent wouldn’t actually affect the current competitors and a significant number of global competitors would remain active. Nokia is more present in European markets while Alcatel-Lucent has more power in North America, this means that even if Nokia will greatly expand, it will have to work hard to gain a good position in said North American markets.

Nokia’s acquisition of Alcatel-Lucent marks another step towards a complete change in the way the company operates, as Nokia is now clearly more focused on business and industry clients rather than being limited to consumer markets. Nokia has surely had some trouble keeping up with the ever-changing mobile market and after Microsoft’s recent purchase of the company’s smartphone area for $7.6 billion, it can now concentrate on expanding without worry about the numerous struggles with the mobile area of the company.

Nokia was fortunate that the European Commission approved the deal with Alcatel-Lucent as the entity is widely known for its continuous efforts to stop any possible competitive unfairness in the market. Their most well-known case was against Google which has been going on for over five years now for an alleged conspiracy of competitors. Fortunately Nokia wasn’t targeted by the European Commission for that much time, as it would have greatly hurt the company’s overall commerce and would have most likely generated a rather hefty fine. It will take some time to see specifically what changes will Nokia’s acquisition of Alcatel-Lucent will have in the somewhat saturated market, with competitors such as Ericsson and Huawei; although there is an elevated chance that it will have a positive impact.