Is it time to subscribe to a printer service from HP?

Ever since my dad brought home an...

What’s the best way of buying a phone today?

How did you buy your latest phone?...

MWC: What device highlights did you miss?

So, early last week I predicted that...

Germany Still Upset At Nokia, Demands Subsidies Returned

nokiabochum
So, here’s the situation. About a decade ago, Nokia setup shop in Bochum, Germany. They hooked up with the local government and secured a bunch of subsidies (to the tune of $60.5 million) to help renovate a TV factory into a cellphone factory. Stipulations of these subsidies included a certain number of jobs created and a certain amount of additional funds invested in the factory over time.

Recently, Nokia announced that it was closing the plant, and moving the work to nearby Romania, which will reduce associated operating costs by about 90%. The local Germans got uber-upset, holding protests and claiming that they would never buy Nokia products again, blah blah blah. It’s been a big PR mess, and I have to say, honestly, I’m a bit dismayed at the Germans reacting so poorly. Sure, it sucks to have a big factory like that closed, but seriously?

In today’s news, it turns out that German government wants Nokia to repay the subsidies that it was given 10 years ago for said plant. Nokia’s holding out, maintaining that it has done everything and more to satisfy the terms of the agreement, and that it’s not refunding anything.

Really, I think Germany is suffering the worst in this situation. It hasn’t really affected Nokia much on a global scale, and if I’m a company looking to setup shop, I’d be a bit more wary of Germany, if this is how big a pain it is to get out later on down the road.

1 COMMENT

  1. It’s a complicated situation, Ricky.
    Combine German industry’s historically benevolent relationship with the trade unions in an area struggling with already high unemployment plus a large dose of regional (rather than national) politics thrown in to the turmoil. (And quite possibly a degree of xenophobia towards both the Finns and the Romanians.)

    These are difficult times in central Europe with massive wage differentials across the newly-relaxed borders, leading many in the workforce to feel like sacrificial cannon fodder.
    Even here in the UK there are hardly any low-paid or casual jobs available any more as formerly-east European migrants dominate the sector.
    Thank goodness for the minimal protection of minimum wage levels!

    I guess the folk in the southern American states went through much the same angst when industry started heading south to Mexico?

    HeavyLight’s last blog post..Study Says Mobile Churn is Approaching 40%

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Recently Published

Is it time to subscribe to a printer service from HP?

Ever since my dad brought home an HP LaserJet printer (version 3, if memory serves), I have been printing with an HP. Over the...

What’s the best way of buying a phone today?

How did you buy your latest phone? I'm asking because I'm thinking about what I should be doing. When I was living in Oman, I...

MWC: What device highlights did you miss?

So, early last week I predicted that next to nothing from Mobile World Congress would break through into the mainstream media. I was right,...

How Wireless Will Pave the Path to Neobank Profitability

I'm delighted to bring you an opinion piece from Rafa Plantier at Gigs.com. I think it's particularly relevant given the recent eSIM news from...

An end of an era: Vodafone UK turns off 3G services

I thought it was worthwhile highlighting this one from the Vodafone UK team. For so long - for what feels like years, seeing the...

Mobile World Congress: Did the mainstream media notice?

I resolved this year to make sure I wrote something - anything - about Mobile World Congress, the huge mobile industry trade show taking...