By Tarmo Virki
PARIS (Reuters) - A fierce price battle for telecoms network gear deals is continuing, with Ericsson (ERICb.ST: Quote, Profile, Research, Stock Buzz) and Huawei aggressively slashing prices, Nokia Siemens Networks NSN.UL Chief Financial Officer Eric Simonsen said.
Nokia Siemens had walked away from several deals as it focuses on improving profit margins and cash flow, he said.
"Ericsson, their view seems to be different, they continue to follow Huawei HWT.UL around, as far as we can see, in terms of crazy pricing," Simonsen told the Reuters Technology, Media and Telecoms Summit in Paris on Wednesday.
Ericsson, Nokia Siemens and Alcatel-Lucent (ALUA.PA: Quote, Profile, Research, Stock Buzz)(ALU.N: Quote, Profile, Research, Stock Buzz) are the leading players in the telecoms network market but have been increasingly challenged by Chinese vendors including Huawei and ZTE (0763.HK: Quote, Profile, Research, Stock Buzz)(000063.SZ: Quote, Profile, Research, Stock Buzz) in the last few years.
Simonsen said Huawei was chasing "market share at any cost".
"Market overall is flat -- Huawei is in there driving in a very different direction, I think others are following, we are not," he said.
Nokia Siemens has forecast the telecoms network equipment market in 2008 to be on last year's level in euro terms.
Ericsson has said there was a possibility pricing competition could ease, and many sector followers had expected the market to have eased by now.
Asked whether the market had turned healthier, Simonsen said: "Market, I'm not sure. Our business, yes."
Nokia Siemens, which started operations in April 2007 as a 50-50 joint venture of top cellphone maker Nokia (NOK1V.HE: Quote, Profile, Research, Stock Buzz) and German technology group Siemens (SIEGn.DE: Quote, Profile, Research, Stock Buzz), is in the midst of 2 billion euros ($3.15 billion) cost-cut program, scheduled to finished by the end of the year.
The company has forecast for flat market share this year.
Simonsen said the venture has started to build up relations with banking community, independent from its owners.
Simonsen, a turnaround specialist, said his eventual departure from the firm would be a sign things are progressing well.
"When its time for regular CFO stuff I'd rather not be around. This is much more fun," Simonsen said. "My typical time at the company is less than the 28 months for CFOs at the average."
(For summit blog: summitnotebook.reuters.com/)
(Editing by James Regan and Quentin Bryar)
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