Nokia Cutting 4000 Jobs, Moving Phone Production to Asia

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Feb. 8 2012 2:32 PM

Nokia Cutting 4000 Jobs, Moving Phone Production to Asia

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(The lettering Nokia Siemens Networks is pictured on February 1, 2012 at the headquarters of Nokia Siemens Networks (NSN) in Munich, southern Germany. The German metal workers' trade union IG Metall had called to demonstrate against the planned close-down of the NSN plant in Munich and the cut of circa 2,900 jobs across the country.)

Photo by PETER KNEFFEL/AFP/Getty Images

Is following in Apple's footsteps always a good business model? Nokia has announced they're moving all assembly of cellphones from Europe to Asia by year's end in order to be closer to their suppliers. The hope is that the move will enable Nokia to introduce innovations into the marketplace more quickly and "ultimately be more competitive."

The Finnish company, which cut nearly 10,000 jobs last year, will pare down an additional 4,000 jobs in order to stay aggressive in the smartphone sector. Nokia has seen its dominance of 40 percent global market share in 2008 slip to 30 percent last year as Android and iPhone sales continue to rise. To compete with those smart phones, the Espoo-based Nokia, which employs 130,000 people, recently partnered with Microsoft and launched its new Windows Phone 7 this past October.

It's another story of manufacturing moving from West to East, but whether it has a happy ending remains uncertain. Apple has been under scrutiny recently for the treatment of workers at its giant manufacturing plants in China.

Ben Johnson is the producer of Marketplace Tech from American Public Media.