Option International NV slumped 23% to 16.94 euros ($21.5) in Europe while in the US Novatel Wireless Inc fell 15.46% to $9.90 and Sierra Wireless Inc saw an 8.73% decline to $11.50 on anticipation that their markets could be savaged by the game-changing deal.
Between them they had revenue of more than $500m in 2005 and wireless modems are currently flying off dealers shelves as the arrival of 3G enables customers to take advantage of the mobile internet.
Intel said it would deliver the Nokia module to notebook manufacturers as part of its Centrino Duo mobile technology platform and it would be widely available as an embedded option in a variety of notebooks.
Heikki Tenhunen, head of Nokia’s Connectivity Module Business Program, said it was a natural area area for the expansion of the company’s multiradio expertise. We believe that 3G connectivity will develop to a strong wireless wide area network mobile connectivity option for notebook computers, he said.
Mooly Eden, vice president and general manager of Intel’s Mobile Platforms Group said the module complemented Intel’s Wi-Fi and WiMAX chipsets to offer expanded connectivity options for notebook users.
In the collaboration between the two companies, Intel has handled the platform design, software, integration and support while Nokia, who manufacture the module, provided the 3G HSDPA knowledge and has the carrier relationships to bring their support for the notebooks.
The advantage that Nokia and Intel have over the modem makers is that users will wants to take advantage of whatever wireless connectivity is available, whether it is WiFi, WiMAX or 3G and bundling these together has considerable advantages over those offering just one option.
The irony is that wireless modems are currently a boom market and Option, the biggest player, saw revenue last year increase by 94% to 198m euros (251m). No-one was available for comment yesterday and there will be some frantic thinking as to how to respond to the new situation.
CDMA is not included in the deal, though this would be essential for sales in the US and the Far East. A Nokia official said this was the subject of several discussions but did not return our call when asked for more explanation of this.
