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Nokia to sell wireless modem business to Japanese company Renesas

Updated Dec 19th, 2018 6:42PM EST

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The NYT reports that Nokia plans to sell its wireless modem business to Japanese company Renesas for $200 million. The NYT cites falling prices (the average cost of a modem is down to 30€ from 120€) and competition from Chinese companies Huawei and ZTE. In an official statement, Nokia wrote:

“The planned transfer of Nokia’s wireless modem business enables Renesas Electronics to maximize the value of Nokia’s technology assets and engineering expertise in delivering advanced mobile platform solutions to the market by combining them with Renesas Electronics’ market-proven multimedia processing and RF technologies.”

Most European wireless ISPs give away mobile wireless modems to their customers, making the margins in the wireless modem business extremely small. Nokia did emphasize that it would stay committed and focused on wireless LTE and HSPA+ technologies, which account for “17% of all broadband connection in Europe,” after the sale.