The joint venture between European telecom companies Nokia and Siemens may pressure their North American rivals Motorola and Nortel to finally jump into the consolidation game, an Associated Press report said.
The report said Nokia and Siemens were merging their network-equipment businesses into a joint venture.
The move follows Ericsson's acquisition of Marconi and Lucent's merger with Alcatel as companies increase their size and reach to more effectively compete in a market that features a glut of traditional telecom equipment players; new, more aggressive providers coming out of China; and a shrinking customer base, according to the report.
The report said Motorola and Nortel stood as the last of the major equipment providers that had yet to participate in a large deal. With consolidation all around them, the two would likely have to make some changes to their businesses.
Nortel spokeswoman Patricia Vernon declined to comment on any future moves, while Motorola was not immediately available for comment, the report said.