Nokia to bolster focus on network security with creation of new unit

Nokia (NYSE:NOK) plans to make security a main focus in its networks business by dedicating a new unit within the company to ensuring that new products have security baked in. The unit's creation, which will happen June 1, comes at a time when network gear vendors are facing continued concerns about the security of their products amid arguments over spying between the United States and China.

Nokia said the new unit, which will a part be of is mobile broadband business, will work to enhance the portfolio of security products and services the company offers and develop business models around telco security. Following the completion of the sale of its devices business to Microsoft (NASDAQ: MSFT), networks is by far the largest unit inside Nokia.

The new unit will comprise resources from across the company, including its customer operations, global services and technology and innovation teams. "We will continue to encourage industry dialogue and knowledge sharing in terms of security research to improve awareness of this crucially important area of telco business, including with open source software," said Marc Rouanne, executive vice president of mobile broadband at Nokia. "This will become critically important as mobile broadband networks are starting to evolve towards the cloud."

To highlight its focus, Nokia pointed out that its "2014 Customer Acquisition and Retention Study Report" showed that 75 percent of customers consider security to be the operator's responsibility. Nokia said a "significant portion" of mobile subscribers are likely to switch operators in case of security issues, and they are willing to pay extra for reliable security protection.

Nokia's focus on security comes amid questions over Cisco Systems security. Chinese state media has accused Cisco of being complicit in U.S. cyberspying, which Cisco has denied. Separately, the U.S. recently indicted five members of the Chinese military, alleging that they had hacked the computer networks of several major American companies.

These recent issues build on a 2012 U.S. government report that labeled Chinese network vendors Huawei and ZTE as security threats that could be used as backdoors for Chinese espionage. Both companies have repeatedly said the claims are without merit.

For more:
- see this release
- see this ZDNet article

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