Industry analysts are speculating that Canadian vendor Nortel may be planning to spin off its UMTS business following rumours of organisational changes within the company.

Nikos Theodosopoulos, analyst with investment bank UBS, said that he has received information which suggests that Nortel has organisationally separated the GSM and UMTS access businesses, “a move that may presage a potential spin-off/disposal of the UMTS access business”.

Nortel is one of the largest vendors which has remained noticeably uninvolved in the recent spate of equipment manufacturer mergers. The recently announced four year strategic alliance between Nortel and Microsoft as well as a focus on enterprise channel partnerships, indicate that the enterprise space continues to be an area of increasing focus.

Motorola is another manufacturer that has not participated in any of the mega-mergers that have seen Lucent and Alcatel and Nokia and Siemens come together in recent months. But the vendor yesterday formed a UMTS kit partnership with Chinese vendor Huawei, which could be an indicator of future strategy.

Nortel has also been wrong-footed this week by the departure of the vice president and general managers for WiMAX and Converged Core Networks including IMS. No replacements have yet been identified and the developments could put Nortel in a predicament as UBS points out that both IMS and WiMAX are two of three key strategic areas of focus for Nortel.

Motorola, Inc. (NYSE: MOT) and Huawei Technologies, Co., Ltd. (“Huawei”), a leader in providing next generation telecommunications network solutions for operators around the world, today announced a new collaboration to bring an enhanced and extensive portfolio of UMTS and HSPA infrastructure equipment to customers worldwide. By combining their expertise in UMTS, the companies will meet the needs of mobile operators today and in the future.

One of the keys to this UMTS venture is the creation of a joint research and development center in Shanghai, China, where employees from both companies will work on development of the architecture and portfolio of products and services.

This feature rich portfolio will offer mobile operators worldwide a compelling choice of UMTS solutions, including one of the broadest ranges of radio access, circuit and packet core products and high speed packet access (HSPA) over a wide range of new frequency bands. This relationship is expected to provide time-to-market advantages while enhancing the ability of both companies to rapidly evolve their UMTS portfolios for the global market.

Motorola will contribute to the collaboration its services expertise in network design, deployment and integration as well as providing value added services such as network performance, network security, network management and Operation Support Systems (OSS). Motorola’s services portfolio will provide operators with the tailored services offerings they need to address the markets they serve. To this collaboration, Huawei will also contribute its dramatically increasing expertise in technology innovation, research and development.

“Motorola is committed to being a global leader in next-generation networks and to supporting its customers with local in-country expertise. With this collaboration, we are better positioned to meet our customers’ 3G network infrastructure needs both today and in the future,” said Greg Brown, president, Networks & Enterprise, Motorola. “This agreement enhances our technological innovation while also creating cost savings for our business.”

“Due to its technology leadership, abundant experience in mobile and valuable relationships with customers around the world, Motorola is the perfect research and development partner for Huawei. Huawei and Motorola customers will benefit immediately from this collaboration with rapid availability of an innovative and extensive product portfolio, as well as our rich experience in mobile networks,” said Zhang Shunmao, president of Wireless Product Line of Huawei. “Today’s announcement will result in a highly competitive commercial product and extensive services portfolio, which will provide operators with immediate access and support for high quality, efficient UMTS and HSPA solutions for deployment worldwide, and help enhance their competitiveness in the market.”

Huawei Technologies announced that it has signed a network contract to construct a CDMA2000 network for Movilnet, one of the largest wireless telecom operators in Venezuela.

Under the terms of the contract, Huawei will provide a wide range of CDMA20001X/1xEV-DO equipment including Radio Access Network and Core Network Softswitch. The contract, which marks a significant milestone in the strategic cooperation between Huawei and Movilnet, will make Huawei a leading provider of CDMA equipment in the Venezuela market.

Widely recognized by CDMA operators worldwide, Huawei’s industry-leading BTS features open framework, broadband platform and professional radio-frequency technologies. As the first wireless communications solution provider to integrate Softswitch technology into a core CDMA network, Huawei bases its CDMA Softswitch solution on the distributed technology of traffic control and bearer, which offers such advantages as huge capacity and high integration. IP transmission solution enables operators to reduce transmission costs significantly.

Mr. JosГ© MarГ­a de Viana, CEO of Movilnet, commented, “We consider Huawei as our strategic and reliable partner that can help expand our CDMA2000 network and meet our requirements. Movilnet plans to offer the best 3G multimedia and communication services to our customers in 2006. We firmly believe that our network subscriber number will reach 8 million by the year-end.”

“We look forward to a closer long-term partnership with Movilnet,” said Mr. Jiang Yafei, President of Huawei Latin America. “Huawei’s leading technologies and professional experience will allow our customers to enjoy high-quality network coverage and more diversified services.”
To date, Huawei has won 19 CDMA2000 1xEV-DO commercial contracts and deployed CDMA networks serving over 40 million subscribers globally. In November 2005, Frost & Sullivan ranked Huawei “Top Three” in global CDMA market.