Nokia today announced plans to outsource development of third-generation (3G) chips to STMicroelectronics and license out its modem technology, widening its supplier base and opening up the market. The world's top cell phone maker said STMicro would design and build 3G chips based on Nokia technologies for Nokia and other customers, freeing up research and development resources for other areas.

Nokia will continue to develop its leading modem technology, which includes protocol software and related digital design for WCDMA/GSM and its evolution. Nokia will then license this modem technology to its chipset manufacturers, who will use it in the chipsets they develop and produce for Nokia and - if they so decide - in the chipsets they produce for the open market.

This licensing and multisourcing strategy will allow Nokia to broaden its pool of chipset suppliers and leverage external innovation to support its wide range of products. It will also allow Nokia to focus on its core competence in modem technology and invest in R&D areas besides radio technology, such as in software to power internet services.

Based on this renewed strategy, Nokia is now working with four chipset suppliers. Texas Instruments continues to be a broad scope supplier across all protocols, Broadcom has been chosen as a supplier in EDGE, Infineon Technologies as a supplier in GSM, and STMicroelectronics as a supplier in 3G.