Nokia's acquisition of the French telecommunications equipment company for $16.6 billion is now confirmed, following reports from earlier this week.
Alcatel-Lucent is not to be confused with Alcatel OneTouch, which is now owned by China's TCL Communication. The former makes equipment that is used in telecommunications infrastructure, while the latter makes phones, tablets and smartwatches that run on Android.
Nokia has dabbled in the world of hardware post Microsoft's acquisition of its devices unit with the Nokia N1, an Android tablet made in collaboration with Foxconn, but the acquisition of Alcatel-Lucent will not be to further the manufacturer's ambitions in this field. What is allows Nokia to do is consolidate its position in the networking equipment segment, and to challenge the likes of Ericsson. Going forward, Nokia has announced that it will be working on key technologies including "5G, IP and software-defined networking, cloud, analytics as well as sensors and imaging."
The combined company will be uniquely positioned to create the foundation of seamless connectivity for people and things wherever they are. This foundation is essential for enabling the next wave of technological change, including the Internet of Things and transition to the cloud.
The combined company will have unparalleled innovation capabilities, with Alcatel-Lucent's Bell Labs and Nokia's FutureWorks, as well as Nokia Technologies, which will stay as a separate entity with a clear focus on licensing and the incubation of new technologies.
The acquisition is subject to several regulatory signoffs, with a final deal expected to close in the first half of 2016.