OXFORD, United Kingdom—Having failed in its ambitions to become one of the top five suppliers of mobile terminals, Alcatel is expected to announce a partnership with another cell-phone developer to help boost its declining fortunes. The company previously admitted it is looking for a business partner to share some of the investment costs associated with designing third-generation (3G) handsets.
Alcatel, which saw sales of its mobile terminals fall from around 20 million in 2000 to just more than 10 million last year, now hopes to achieve similar results this year after cutting its cell-phone work force to 600 employees in the expectation that it might report a profit for the first six months of 2002. Handsets currently account for less than 10 percent of Alcatel’s sales, as the company has continued to lose market share in recent years.
Meanwhile, Lothar Paul, a board member at Siemens, said he expects the price of cell phones to fall a further 10 percent in the run-up to Christmas. Only in the first quarter of 2003 will the prices begin to rise as new models are introduced, said Paul.
