CELEX: 32015M7632
Language: en
Date: 2015-07-24 00:00:00
Title: Commission Decision of 24/07/2015 declaring a concentration to be compatible with the common market (Case No COMP/M.7632 - NOKIA / ALCATEL-LUCENT) according to Council Regulation (EC) No 139/2004 (Only the English text is authentic)

|[pic]                             |EUROPEAN COMMISSION                                                                                      |

Brussels, 24.07.2015
C(2015) 5315 final

|In the published version of this decision, some information has   |                                                                           |                                                                       |
|been omitted pursuant to Article 17(2) of Council Regulation (EC) |                                                                           |                                                                       |
|No 139/2004 concerning non-disclosure of business secrets and     |                                                                           |                                                                       |
|other confidential information. The omissions are shown thus […]. |                                                                           |                                                                       |
|Where possible the information omitted has been replaced by ranges|                                                                           |                                                                       |
|of figures or a general description.                              |                                                                           |                                                                       |
|                                                                  |                                                                           |                                                                       |

|To the notifying party:                                                |                                                                       |
|                                                                       |                                                                       |

Dear Sir/Madam,

Subject:    Case M.7632 NOKIA/ ALCATEL-LUCENT
Commission decision pursuant to Article 6(1)(b) of Council Regulation No 139/2004[1] and Article 57 of the Agreement  on  the  European  Economic
Area[2]
    1) On 19 June 2015, the European Commission (the "Commission") received notification of a proposed concentration pursuant to Article 4 of the
       Merger Regulation by which Nokia Corporation ("Nokia" or the "Notifying Party") will acquire sole control within the  meaning  of  Article
       3(1)(b) of the Merger Regulation over Alcatel-Lucent S.A. ("Alcatel") by way of a public offer (the "Transaction"). Nokia and Alcatel  are
       collectively referred to as "Parties".

THE PARTIES

    2) Nokia is a global provider of mobile network equipment and networks service platforms,  active  also  in  the  provision  of  professional
       services to telecommunications network operators and service providers. Nokia's network equipment activities have a  geographic  focus  in
       the European and Asian markets.

    3) Alcatel is active in the provision of fixed and mobile network equipment, as  well  as  related  services  to  telecommunications  network
       operators worldwide. Alcatel's activities are mainly focused on the North American continent.

THE CONCENTRATION

    4) Pursuant to the Memorandum of Understanding entered into between the Parties on 15 April 2015, Nokia will launch public tender offers  for
       Alcatel's shares in France and in the United States. Following the completion of these offers, Nokia will own  between  50%  and  100%  of
       Alcatel's shares.

    5) Following the tender offers, Nokia expects to acquire more than 50% of Alcatel's shares. The remaining shareholders will  likely  continue
       to be widely dispersed.[3] Even if, post-transaction, Nokia would hypothetically acquire a shareholding  of  only  50.1%,[4]  pursuant  to
       Alcatel's governance documents post-transaction Nokia would have enough votes to adopt any ordinary shareholder resolution, such as, inter
       alia, appointment and dismissal of the board members, (directly or indirectly) appointment and dismissal of other  senior  management  and
       overall strategic commercial decisions of the company, including approval of the business plan and  budget.  Therefore,  Alcatel  will  be
       subject to sole control by Nokia.

    6) The Transaction constitutes therefore a concentration within the meaning of Article 3(1)(b) of the Merger Regulation.

EU DIMENSION

    7) The undertakings concerned have a combined aggregate world-wide turnover of more than EUR 5  000  million  (Nokia:  EUR  12  732  million;
       Alcatel: EUR 13 177 million). Each of them has an EU-wide turnover in excess of EUR 250 million (Nokia: EUR […] million; Alcatel: EUR  […]
       million), but they do not achieve more than two-thirds of their aggregate EU-wide turnover within one  and  the  same  Member  State.  The
       Transaction therefore has an EU dimension.

RELEVANT MARKETS

    8) The Transaction combines two global providers of telecommunications  network  equipment  and  related  services  resulting  in  horizontal
       overlaps mainly in the markets for the provision of (i) Radio  Access  Network  ("RAN")  equipment;  (ii)  Core  Network  Systems  ("CNS")
       solutions; and (iii) network-related services. A possible vertical link between the activities of the Parties  has  also  been  identified
       within CNS solutions.

1  RAN equipment

    9) RAN equipment provides the radio functions of the mobile network by transmitting signals between the mobile handset and the  core  portion
       of the mobile network. Therefore, the RAN has an open interface to mobile end-user devices and to the CNS.

   10) RAN equipment can be grouped into standard generations (2-2.5G, 3G, 4G and the future 5G). The most recent technology  generation  is  4G,
       currently actively deployed by operators both in Europe and in the US. 3G, while still being widely used and to some extent rolled-out, is
       considered a mature technology given that in many countries 3G networks have already been deployed for quite some time and have reached  a
       coverage of over 95% in the EEA.[5] 2-2.5G is regarded as a legacy technology.

   11) 2G systems support primarily voice services, but also basic data transmission such as text messaging. 2G standards include GSM, CDMA, iDen
       and PDC technologies. 2.5G systems are overlays on 2G systems and do not fundamentally change the  network  structure,  but  allow  better
       delivery of data information. 2.5G includes GPRS and EDGE technologies. As explained in paragraph (10), 2G-2.5G networks are  very  mature
       technologies, and today represent only a small portion of total network infrastructure revenue, given that 2G networks are no longer being
       rolled out and revenues from 2G equipment mainly stem from maintenance.

   12) In the EEA, 3G systems include primarily WCDMA/  UMTS  technology.[6]  Other  3G  technologies  include  CDMA  1x  EV-DO,  which  is  used
       predominantly in the U.S., Canada, South Korea, Mexico, India, Israel, Australia, Venezuela and China, and was used only to a very limited
       extent in the EEA. TDSCDMA is a variant of 3G technology that is only used in China. As explained in paragraph (10), 3G is also considered
       a mature technology.

   13) 4G systems refer to the latest generation of wireless network currently in the market. 4G includes Long Term  Evolution  (LTE)  technology
       that is used for data transmission, VoLTE (Voice Over LTE) and WiMAX.[7] 4G systems  most  typically  refer  to  networks  utilizing  LTE.
       Currently, many operators are rolling out LTE networks, but continue to run voice services over 3G portions  of  their  network,  although
       some operators are beginning to shift to VoLTE to carry voice services over LTE and an IP-based core.

   14) Analyst forecasts foresee 4G RAN equipment sales (and related expenditure of mobile operators) to increase worldwide, corresponding  to  a
       steady decline of sales of RAN equipment supporting other technologies, as shown by Figure 1 below.

                                                      Figure 1: Total RAN revenues worldwide

                 [pic]

Source: Dell’Oro, Report of 7 October 2014

   15) 5G systems constitute the next phase of mobile telecommunication standards beyond the current 4G standards. However, 5G is  still  in  the
       development phase and no standards have yet been adopted to define 5G technologies.

   16) While in the past, network equipment was technology specific, more recently, there is also another type of equipment technology,  the  so-
       called Single RAN ("SRAN") technology, which allows mobile operators to run and operate multiple mobile telecommunication standards  on  a
       single network. SRAN is commonly defined as a radio portfolio, which supports simultaneous usage of 2G (GSM), 3G (UMTS) and 4G (LTE) radio
       technologies. Single RAN is not standardized and equipment vendors offer different features under the Single RAN  banner.  Currently  many
       operators in Europe are transitioning towards SRAN. While Nokia provides SRAN solutions, Alcatel-Lucent does  not  provide  this  type  of
       equipment.

   17) Another recent technological development is the emergence of the so-called "small cells" technology, deployed mainly in densely  populated
       areas to provide data traffic offloading. Individual geographic areas covered with mobile radio equipment are known as "cells"  or  "macro
       cells", as the coverage they provide can have a radius range of few tens of kilometres. By contrast, small cells have a radius of  between
       10 meters to 1 or 2 km. Small cells can be used to provide in-building and outdoor wireless service. At present, the small  cells  segment
       remains relatively small, but it is expected to grow over the next few years.

   18) RAN equipment is typically purchased through tender procedures. In some cases the bidding process is designed for a “single winner” and in
       other cases the offer is split between two and sometimes even three vendors. Investment cycles are  relatively  long,  in  particular  for
       large roll-out projects. Large roll-out projects are typically tendered in a frame contract which already specifies prices and  discounts.
       In the execution phase, specific purchase orders are issued under the terms of the contracted framework. The  typical  duration  of  frame
       contracts is three years which would typically involve an initial order without further purchase  commitments.  Mobile  operators  usually
       refresh their whole network every 3-5 years. Important tenders are also launched  when  there  is  a  technology  change:  this  can  have
       disruptive effects on providers positioning (market share) at worldwide or regional level. Tenders are launched also for legacy technology
       for maintenance purposes and gap-filling of current networks.

1 Relevant product market

The Commission investigated the relevant mobile telecommunication equipment markets in  the  Nokia/Siemens[8]  and  Nokia/Motorola[9]  cases.  In
Nokia/Siemens the Commission considered that RAN and CNS could constitute separate product markets, given that the interchangeability  of  mobile
network products is not equivalent within each product category.[10] However, it ultimately left the  precise  product  market  definition  open.
Moreover, in Nokia/Siemens the Commission also found evidence that a further segmentation according to technology  (GSM/GPRS/EDGE,  CDMA  and  W-
CDMA) could be made within RAN. However, it ultimately left the precise product market definition open.[11] In Nokia/Motorola the  exact  product
market definition was also left open.[12]

The Notifying Party submits that the relevant product market definition can be left open as the Transaction in the Notifying  Party's  view  does
not give rise to any competition issues regardless of the product market definition adopted.

As regards a possible segmentation based on equipment technology, the majority of the customers who replied to the market investigation  in  this
case do not consider RAN equipment based on 2-2.5G, 3G and 4G standards  substitutable  in  terms  of  functionalities  offered.  Some  customers
explain that different generations of equipment offer different functionalities (for example, 2G offers voice and basic data services, 3G  offers
voice and enhanced data services, while 4G offers mainly data services, which are further enhanced compared  to  3G).  Another  customer  further
explains that, although 2-2.5G and 3G equipment can be updated to some extent, they cannot offer  the  same  performance/cost  ratio  as  network
equipment supporting newer technologies.[13] In turn, the majority of competitors  confirm  the  lack  of  supply-side  substitutability  between
equipment belonging to the different types of telecommunications standards.[14]

As regards SRAN equipment, approximately half of the customers who replied to the market investigation consider the functionalities  of  SRAN  to
be the same as RAN equipment based on one single standard (2-2.5G, 3G or 4G). However, a large group of customers  consider  the  functionalities
of SRAN and RAN equipment based on one single standard not to be the same. One customer states that only a SRAN approach allows a cost  efficient
migration of traffic from legacy generation to the newer generations of radio protocols. Moreover, the majority of customers explain that,  while
the initial investment required with SRAN may be higher, in the long term SRAN functionalities are better in terms of efficiency  than  those  of
RAN equipment based on one single standard. Several customers also emphasize that SRAN is also better in terms of flexibility, as it  allows  the
operators to decide how many RAN resources to dedicate to the different technologies, having the possibility of switching  off  old  technologies
and dedicating resources to the new ones.[15] In terms of supply-side substitutability between SRAN and the equipment belonging to  each  of  the
various telecommunications standards, the market investigation was not conclusive.[16]

As regards small cells, the majority of customers who replied to the market investigation do not consider  small  cells  substitutable  to  macro
cells in terms of functionalities offered. Moreover, the majority of such customers also consider that  there  is  a  significant  difference  in
terms of cost for roll-out and maintenance for macro and small cells. Several customers emphasize the complementary character of small cells  and
macro cells: small cells provide less coverage, being suitable therefore for small geographic areas. However, their installation  and  deployment
cost is also lower. Macro cells require a higher initial investment, but they offer wider network coverage, being  suited  therefore  for  larger
geographic areas. Some customers further state that the functionalities of small and macro cells could be the same, but  that  the  coverage  and
the in-building penetration are different.[17]

In the light of the above, the Commission considers that the RAN equipment market may be segmented by technology standards and/or between  macro-
cells and small-cells equipment. Moreover, it cannot be excluded that SRAN equipment may constitute a separate market segment.  However,  as  the
Transaction will not give rise to serious doubts as to its compatibility with the internal market under  any  plausible  market  definition,  the
question of the exact scope of the relevant product market can be left open.

2 Relevant geographic market

As regards the geographic scope of the RAN equipment market (and its possible segments), in Nokia/Siemens the Commission had  evidence  that  the
market for mobile network equipment, including RAN, is at least EEA-wide if not global, but  ultimately  left  the  exact  geographic  definition
open.[18] In the Nokia/Motorola case the geographic market definition was also left open.[19]

The Notifying Party submits that the relevant geographic market for mobile network equipment, including RAN, is global in scope  due  to  several
factors including: (i) international standardization of mobile telecommunications network equipment; (ii) vendor  and  industry  interoperability
initiatives through Interoperability Testing Centers (“IOTs”); (iii) contracts that are competed on a  global  basis  –  there  is  no  longer  a
concept of ‘home’ market or region; (iv) worldwide shipping and limited transport costs; (v) limited regional variations in cost and  price;  and
(vi) liberalized downstream service markets leading to open upstream equipment markets.

The Notifying Party also submits that RAN vendors are multinational firms with worldwide presence that bid on opportunities at a global level.  A
number of customers are international companies or have global parents, which, according to the Notifying  Party,  sometimes  take  advantage  of
their global scale of operations. Moreover, in the Notifying Party's view, the global scope of the relevant market(s) is not  put  into  question
by differences in relative market positions of RAN equipment vendors in different regions of the world. According to the Notifying Party,  market
shares in any particular region are not necessarily indicative of actual competition at regional  or  global  basis,  given  the  nature  of  the
downstream market. In this respect, the Notifying Party submits that the fact  that  there  are  differences  in  relative  market  positions  of
suppliers in different regions of the world reflects the purchasing dynamics and does not suggest that  there  are  separate  geographic  markets
with differing competitive characteristics.

The majority of the customers who replied to the market investigation submit that their activities are limited to  the  EEA  only  and  therefore
they do not have a view on possible differences in price, technology or footprint of different vendors for the supply of  RAN  equipment  in  the
EEA and other parts of the world.

As regards prices, several customers state that in general prices for RAN equipment are the same for EEA and other regions.[20]

As regards technology, several customers point to SRAN being the preferred technology in Europe as opposed to the rest of  the  world.  Moreover,
the technology standards and radio frequencies (spectrum) used may also differ across different regions.[21]

As regards vendors’ footprint, several customers submit that all vendors  have  worldwide  footprint,  but  that  their  strength  varies  across
regions.[22]

The majority of competitors who replied to the market investigation confirm that they are active in the supply of RAN equipment worldwide.  There
are, however, certain regions of the world where some vendors do not actively compete: Chinese vendors, despite their global  presence,  are  not
active in the United States, given the latter's security concerns.[23]

As regards prices, the majority of competitors also state that their prices are not homogeneous worldwide due to the  different  requirements  of
mobile operators.[24] As regards technology, half of the competitors state that the technology and standards are global  and  that,  as  products
are developed supporting telecommunication standards, no difference among regions exists. The other half of the competitors,  however,  considers
that differences in terms of technological development exist between regions. In particular, one competitor submits, that although  the  products
are based on global telecommunication standards, customers have very specific requirements for the products to be included in their networks.

As regards differences in customer preferences between the EEA and other regions, the majority of  competitors  confirm  that  these  differences
exist. Several competitors point to SRAN as being typically requested by all customers in the EEA.[25] The large  majority  of  competitors  also
confirm the existence of differences in terms of applicable regulation and legal requirements between the EEA and  other  regions  of  the  world
(for example US operators require security certificates).[26]

In any event, the exact geographic scope of the RAN  equipment  market  and  its  possible  segments  and,  in  particular,  whether  such  scope
encompasses only the EEA or is worldwide, can be left open, as the Transaction will not give rise to serious doubts as to its compatibility  with
the internal market under any plausible market definition.

2  CNS solutions

CNS solutions includes the following main elements: (i) wireless packet core equipment; (ii) carrier IP telephony solutions; and (iii)  operation
and business support software ("OSS/BSS").[27]

The wireless packet core sits between the RAN portion of the network and the Internet Protocol  ("IP")  network  of  the  operator  enabling  the
delivery of voice and data traffic to and from the mobile handset of the user. There are two types of  packet  core  equipment:  (a)  Traditional
Packet Core used in 2G and 3G network[28] and (b) Evolved Packet Core used in 4G networks.

The architecture of the Traditional Packet Core consists of the following four main elements: (i) Gateway GPRS Support Node ("GGSN")  responsible
for the interworking between the GPRS network and external packet switched networks  such  as  the  Internet;  (ii)  Serving  GPRS  Support  Node
("SGSN") responsible for the routing, transfer and delivery of data packets from and to the  mobile  stations  within  its  geographical  service
area; (iii) Packet Data Serving Node ("PDSN") which is specific to CDMA mobile networks and serves as the connection point between RAN  equipment
and IP networks; and (iv) Access Service Network ("ASN") Gateway which controls and aggregates traffic from WiMAX base stations.[29]

The Evolved Packet Core has two main components: (i) Mobility Management Entity ("MME") which fulfils the role of a control and  signalling  node
that manages session states and authenticates and tracks a user across the networks; and (ii) Packet Data  Node  Gateway  ("PGW")  which  is  the
interface between 4G LTE network and other packet data networks such as the Internet.

In general, network operators purchase the wireless packet core equipment as a complete solution from one vendor. However, the sub-components  of
the wireless packet core[30] can be purchased independently thanks to the standardised interfaces between the different sub-components.

Carrier IP telephony solutions enable the transmission of real-time voice over the Internet or  over  an  IP  network  via  Voice  over  Internet
Protocol ("VoIP") and via the emerging VoLTE. Certain Carrier IP telephony solutions can enable the  delivery  of  multimedia  services  such  as
voice calls, messages and file sharing. Similar to the wireless packet core, Carrier IP telephony products are typically purchased as a  complete
solution from one vendor. However, given that its components and sub-components[31] are standardised, purchasing these components from  different
vendors is not unusual for operators that seek to optimise the technical aspects of their networks to suit their specific needs.

OSS/BSS: the proper technical and commercial operation of a network requires the use of Operations Support System ("OSS") software  which  allows
operators to manage, monitor and control network operations and services, as well  as  the  use  of  Business  Support  System  ("BSS")  software
enabling operators to carry out the business-related functions, such as billing, charging and subscriber management functions.

OSS interfaces (and in particular to the so-called northbound interfaces "NBI" that allow for a given network component  to  communicate  with  a
higher-level component) describe the network status information generated by the macro cells and the other radio network  elements.  This  status
information is an input for the optimization of the network which is achieved through another  software  solution,  the  Self-Organizing  Network
("SON") software. SON solutions provide network with the ability to quickly and autonomously optimize itself. Two types of  SON  software  exist:
distributed SON and centralised SON.

Distributed SON consists in distributed or decentralized software solutions which are integral part of the OSS software. Such solutions are  only
offered by OSS vendors and they do not typically have multi-vendor capabilities, i.e. they cannot be deployed and run on every network.

Centralised SON ("C-SON") consists of software solutions that "sit" with central equipment controlling the entire network and constitute an "add-
on" rather than an integral part of the OSS software. C-SON solutions are provided also by non-OSS vendors and these solutions  have  multivendor
capability.

As status information generated by the OSS is an input for the operation of SON, and in  particular  C-SON  solutions,  a  vertical  link  exists
between OSS and SON/C-SON.

CNS solutions are typically purchased through tender procedures similar to those described at paragraph (18) above.

1 Relevant product market

As explained in paragraph (19) above in its Nokia/Siemens decision, the Commission considered, that  in  view  of  the  fact  that  RAN  and  CNS
equipment can be purchased entirely independent from one another, CNS and RAN  equipment  could  constitute  separate  product  markets.[32]  The
Commission left the precise market definition open in this respect both in the Nokia/Siemens and Nokia/Motorola decisions.[33]

In Nokia/Siemens,[34] the Commission also considered possible segmentations within CNS solutions:  a  possible  subdivision  of  the  Traditional
Packet Core into circuit-based and packet-based switching products along with a  possible  further  subdivision  of  the  packet-based  switching
products into Serving GPRS Support Nodes (SGSN) and Gateway GPRS Support Nodes (GGSN), but ultimately left the exact market definition open.

Since Nokia/Siemens the industry has transitioned to the newer 4G technology, whose network functionalities  revolve  around  an  Evolved  Packet
Core, which no longer distinguishes between circuit-core and packet-core, but treats all voice and data as packets. The Commission  has  not  yet
analysed the exact scope of the relevant product market/s in relation to either Evolved Packet Core equipment or Carrier IP telephony products.

In relation to OSS/BSS, in Nokia/Siemens, the Commission considered a possible distinction between OSS  and  BSS,[35]  but  ultimately  left  the
exact product market definition open.

The Notifying Party submits that the relevant product market definition can be left open as the Transaction in the Notifying  Party's  view  does
not give rise to any competition issues regardless of the product market definition adopted.

As regards the wireless packet core the majority of customers who replied to the market investigation consider that the  two  types  of  wireless
packet core, that is to say the Traditional Packet Core and the  Evolved  Packet  Core,  are  not  substitutable  in  terms  of  functionalities.
Respondents explain that the Traditional Packet Core is meant to support 2-2.5G and 3G services while the Evolved Packet  Core  supports  2-2.5G,
3G and in addition 4G services thus performing the legacy functionalities of the Traditional Packet Core on top of the  new  4G  functionalities.
The majority of competitors who replied to the market investigation confirm the lack of  supply-side  substitutability  between  the  Traditional
Packet Core and the Evolved Packet Core.[36]

Customers also unanimously state that the node components of the Traditional Packet Core (GGSN and SGSN) have entirely different  functionalities
(SGSN is setting up the mobile data connectivity while GGSN is a gateway and handles the mobile data traffic) and cannot be substituted with  one
another.[37] As regards the two components of the Evolved Packet Core (MME and PGW) the vast majority of customers consider  these  two  building
blocks to cover different functionalities (similarly to the roles played by the GGSN and SGSN in the Traditional Packet Core, the MME is  setting
up the mobile data connectivity and  the  PGW  is  handling  the  throughput).[38]  The  majority  of  competitors  consider  that  there  is  no
substitutability from the supply side between GGSN and SGSN and between MME and PGW.[39]

Regarding Carrier IP  telephony  solutions  the  large  majority  of  customers  consider  that  the  different  Carrier  IP  telephony  products
(Softswitches, Media Gateways, SBC, VAS, IMS Core) are not substitutable in terms of functionalities offered. Most competitors also confirm  that
there is no supply-side substitutability between these products.[40]

As regards substitutability between Softswitch wireline and Softswitch wireless and between Media Gateway wireline and  Media  Gateway  wireless,
the large majority of customers consider that the functionalities of wireline and wireless products are quite different.  A  respondent  explains
that Media Gateway products are tightly coupled with the corresponding Softswitches and that, since Softswitches are  not  substitutable  between
wireline and wireless, Media Gateway wireline products and Media Gateway wireless are also not substitutable.[41]  The  majority  of  competitors
also consider  that  there  is  no  substitutability  between  the  wireline  and  wireless  Media  Gateway  and  Softswitch  from  the  vendor's
perspective.[42]

IMS CSCF and IMS HSS, which are the two main components of the IMS Core, are also considered not substitutable between each other  due  to  their
different functionalities by all customers who replied to the market investigation. Customers explain that IMS CSCF, which handles  call  session
control, is a different logical entity from IMS HSS, which is the user database and both IMS CSCF and IMS  HSS  are  necessary  to  provide  VoIP
services. Some respondents state that it is possible to have different vendors for CSCF and HSS despite  the  interoperability  issues  that  may
arise. A number of competitors also consider that there is no supply-side substitutability between CSCF and HSS.[43]

The large majority of both customers and competitors who replied to the market investigation consider that there is a clear  distinction  between
distributed or decentralized SON solutions, which are integral part of the OSS software, do not have a multivendor capability and are offered  by
OSS vendors, and the centralized C-SON solutions, which are more of an "add-on" to the  OSS  and  can  be  provided  by  non-OSS  vendors.[44]  A
significant number of customers point out that they have not purchased or do not need a C-SON solution. Based on the replies of  those  customers
who purchased C-SON solutions, it appears that customers purchase such solutions sometimes together and sometimes separately from RAN and/or  CNS
equipment.[45]

In any event, for the purpose of this decision, the Commission considers that the exact product market definition, and in  particular  whether  a
distinction should be made between (i) wireless packet core, including a possible segmentation into Traditional Packet Core  and  Evolved  Packet
Core and a further sub-segmentation of these two products into SGSN and GGSN and into  MME  and  PGW  respectively;  (ii)  Carrier  IP  telephony
products, including a possible segmentation of these products into  Softswitch  products  (and  their  further  segmentation  into  wireless  and
wireline), Media Gateway products (and  their  further  segmentation  into  wireless  and  wireline),  SBC,  VAS,  IMS  Core  (including  further
segmentation into CSCF and HSS); and (iii) OSS/BSS including whether decentralised and centralized SON solutions constitute separate  markets  or
market segments, can be left open as the Transaction will not give rise to serious doubts as to its compatibility with the internal market  under
any plausible market definition.

2 Relevant geographic market

As regards the geographic scope of the CNS market (and its possible segments) in  Nokia/Siemens[46]  and  in  Nokia/Motorola[47]  the  Commission
considered the scope to be at least EEA-wide, if not global, but left the exact geographic market definition open.

The Notifying Party submits that all relevant markets for CNS equipment should be considered global in scope.

The majority of customers who replied to the market investigation submit that their activities are limited to the EEA only and therefore they  do
not have a view on possible differences in price, technology or footprint of different vendors for the supply  of  wireless  packet  core  and/or
Carrier IP telephony solutions for other parts of the world. However, among the customers who replied to  the  relevant  question,  the  majority
considers there are no significant differences between the EEA and other parts of the world in terms of prices,  technologies[48]  and  footprint
of vendors.[49]

The majority of the competitors who replied to the market investigation confirm that they are active in the provision  of  Wireless  Packet  Core
and Carrier IP telephony solutions at worldwide level. Notwithstanding the global presence of these vendors, there are  certain  regions  of  the
world where they do not actively compete. For example, Chinese vendors, who have a strong domestic footprint and an important position  globally,
are not present in the United States.[50] As regards prices, the majority of  competitors  also  state  that  their  prices  are  not  homogenous
worldwide.[51] Finally, as regards technology, the results of the market investigation suggest that technological differences exist based on  the
different generation of cellular standards deployed in a certain region (4G roll-out is not equally advanced worldwide).[52]

In any event, the exact geographic scope of the relevant markets, and  in  particular  whether  their  scope  encompasses  only  the  EEA  or  is
worldwide, can be left open, as the Transaction will not give rise to serious doubts as to its compatibility with the internal market  under  any
plausible market definition.

3  Network Infrastructure Services

There are two types of network infrastructure services related to RAN equipment and CNS solutions: (i) network implementation and care  services,
closely connected to the supply of network equipment, and covering functions like deployment, installation and maintenance of network  equipment,
software support, etc.; and  (ii)  professional  services,  which  include  managed  services,[53]  network  planning,  optimization  and  system
integration services.

1 Relevant product market

In its previous decisions in Nokia/Siemens and  Nokia/Motorola,  the  Commission  considered  a  distinction  between  Deployment,  Delivery  and
Installation ("DDI") services and Maintenance and Care ("M&C") services, leaving the precise scope of the relevant product market  open.  Nothing
in the course of the investigation in this case justifies a deviation from these findings.

In any event, also in the case at hand, the exact product market definition can be left open as the Transaction will not  give  rise  to  serious
doubts as to its compatibility with the internal market under any plausible market definition.

2 Relevant geographic market

As regards the geographic dimension of the market, in its previous decisions, the Commission considered this market to be at least  EEA-wide  and
possibly global, but left the exact geographic market definition open. Nothing in the course of  the  investigation  in  this  case  justifies  a
deviation from these findings.

In any event, also in the case at hand, the Commission considers that the exact geographic market definition can be left open as the  Transaction
will not give rise to serious doubts as to its compatibility with the internal market under any plausible market definition.

COMPETITIVE ASSESSMENT

1  Affected Markets

The Parties' activities horizontally overlap in a possible overall market for the provision of mobile network equipment (comprising both RAN  and
CNS solutions), giving rise to possible affected markets at worldwide level (combined market share: [20-30]%; Nokia  [10-20]%  and  Alcatel  [10-
20]%) and at EEA level (combined market share: [20-30]%; Nokia [20-30]%; and Alcatel [5-10]%).

With specific respect to RAN equipment and its possible segments, the Parties' activities horizontally overlap both worldwide and in the EEA  and
give rise to several affected markets and market segments as shown by the below Table 1.

            Table 1: Affected possible markets at EEA and worldwide level (market shares are calculated on the basis of 2014 revenues)

|                                                      |Nokia            |Alcatel           |Combined             |
|Overall RAN                  |Worldwide               |[10-20]%         |[10-20]%          |[20-30]%             |
|                             |EEA                     |[20-30]%         |[5-10]%           |[30-40]%             |
|4G (LTE)                     |Worldwide               |[10-20]%         |[10-20]%          |[30-40]%             |
|                             |EEA                     |[20-30]%         |[5-10]%           |[20-30]%             |
|3G                           |Worldwide               |[20-30]%         |[0-5]%            |[20-30]%             |
|                             |EEA                     |[30-40]%         |[5-10]%           |[30-40]%             |
|2G (GSM/GPRS/EDGE)           |Worldwide               |[20-30]%         |[5-10]%           |[20-30]%             |
|                             |EEA                     |[20-30]%         |[0-5]%            |[20-30]%             |
|2G (CDMA)                    |Worldwide               |[5-10]%          |[40-50]%          |[50-60]%             |

Source: Annex 7 to the Form CO

As illustrated by Table 1, the merged entity would have market shares above 20% in the possible overall RAN equipment market, both  at  worldwide
and EEA level, as well as in the possible market segments for RAN equipment based on 4G (LTE), 3G and 2G (GSM/GPRS/EDGE), both at  worldwide  and
EEA level, and in the worldwide market segment for RAN equipment based on 2G (CDMA).

The Parties’ activities also horizontally overlap in the supply of CNS solutions, both at EEA level and at  worldwide  level  and  give  rise  to
several affected markets and market segments as shown by the below Table 2.

              Table 2: Affected possible markets at EEA and worldwide level (market shares calculated on the basis of 2014 revenues)

|                                                     |Nokia               |Alcatel             |Combined            |
|All Traditional Packet Core |Worldwide               |[10-20]%            |[0-5]%              |[20-30]%            |
|SGSN                        |Worldwide               |[20-30]%            |[0-5]%              |[20-30]%            |
|All Softswitches            |Worldwide               |[10-20]%            |[5-10]%             |[20-30]%            |
|(wireline + wireless)       |                        |                    |                    |                    |
|                            |EEA                     |[20-30]%            |[0-5]%              |[20-30]%            |
|Softswitches wireless       |Worldwide               |[20-30]%            |[0-5]%              |[20-30]%            |
|All Media Gateways          |EEA                     |[20-30]%            |[0-5]%              |[20-30]%            |
|(wireline + wireless)       |                        |                    |                    |                    |
|All IMS Core                |Worldwide               |[10-20]%            |[5-10]%             |[20-30]%            |
|IMS CSCF                    |Worldwide               |[20-30]%            |[10-20]%            |[30-40]%            |
|IMS HSS                     |Worldwide               |[10-20]%            |[5-10]%             |[20-30]%[54]        |
|OSS                         |EEA                     |[10-20]%            |[5-10]%             |[20-30]%            |

Source: Annex 8 to the Form CO

As illustrated by Table 2, the merged entity would have market shares above 20%  in  several  possible  CNS  segments,  namely:  SGSN  worldwide,
Softswitches both at worldwide and in the EEA, Softswitches wireless worldwide, all Media Gateways in the EEA, and IMS Core,  IMS  CSCF  and  IMS
HSS worldwide.

Although the Parties' combined market shares in the possible C-SON market would be below 20% (both at worldwide and  EEA  level),  this  possible
market would be technically vertically affected in view of the relationship explained in paragraph (46) above.

2  RAN equipment

1 Notifying Party's view

The Notifying Party claims that the Transaction will not give rise to competition concerns at the  EEA  or  worldwide  level  for  the  following
reasons: (i) post-merger an important number of major global competitors like Ericsson, Huawei and ZTE will remain active; (ii) the  RAN  markets
are bidding markets with fierce competition and customers in the face of telecommunication operators have  considerable  buyer  power;  (iii)  at
present all meaningful competition takes place only in relation to 4G LTE and the future  transition  to  5G  will  provide  the  opportunity  to
smaller players to increase their presence; and (iv) the focus of the Parties' activities is on different geographic  areas  (North  America  for
Alcatel and Europe and Asia for Nokia).

In particular, the Notifying Party submits that the Transaction  will  not  reduce  technology  or  innovation  competition  for  RAN  equipment.
According to the Notifying Party, the ability to innovate is key in the wireless network infrastructure industry, which is rapidly evolving  from
a hardware-based to a software-and cloud-based technology. Therefore, the Notifying Party submits that, post-transaction, the  merged  entity  as
well as all competitors would keep a strong incentive to innovate.

The Notifying Party also states that at present all meaningful competition takes places only in relation to 4G LTE. According  to  the  Notifying
Party, while the more mature 2G and 3G technologies such as GSM, CDMA, and WCDMA are still in use, wireless operators have shifted to new 4G  LTE
solutions. As a consequence, revenues in relation to 2G and 3G are mainly limited to sales to existing customers. Moreover,  since  2013  Alcatel
has started to refocus itself as a specialist in IP networking, cloud and ultra-broadband access and will no longer actively invest  in  what  it
views as legacy technology. Moreover, the Notifying Party claims that any assessment of RAN competition must take into account the fact  that  in
future competition will take place for 5G systems, which has not yet been commercialized.

Moreover, the Notifying Party claims  that  competition  between  RAN  vendors  is  fierce,  large  wireless  telecommunications  operators  with
substantial buyer power playing RAN vendors off  against  one  another,  through  bidding  processes  typically  characterized  by  the  lack  of
transparency in price levels, as well as lack of transparency in the identity of competing bidders.

In addition, the Notifying Party submits that disruptive technologies currently emerging in RAN, such as Network Function Virtualization  ("NFV")
and Cloud-based RAN ("C-RAN") solutions provide opportunities for new and adjacent players to enter the RAN space. The Notifying  Party  mentions
as an example that LTE RAN start-up Altiostar and Cisco have partnered to offer C-RAN solutions.

Finally, the Notifying Party emphasizes the complementary character of the geographic positions of Nokia and Alcatel: North America  for  Alcatel
and Europe and Asia for Nokia.

2 Commission's assessment

1 All RAN equipment

The Parties' and their main competitors' shares in relation to RAN equipment are illustrated in the below Table 3.

               Table 3: Market shares for overall RAN equipment (2-2.5G, 3G and 4G) at worldwide and EEA level for 2014 by revenue

|                            |Worldwide                         |EEA                               |
|Nokia                       |[10-20]%                          |[20-30]%                          |
|Alcatel                     |[10-20]%                          |[5-10]%                           |
|Combined                    |[20-30]%                          |[30-40]%                          |
|Ericsson                    |[30-40]%                          |[30-40]%                          |
|Huawei                      |[20-30]%                          |[30-40]%                          |
|ZTE                         |[5-10]%                           |[0-5]%                            |
|Samsung                     |[0-5]%                            |[0-5]%                            |

Source: Annex 7 to the Form CO

As shown by the above table, both at worldwide and EEA level the Parties' combined market shares would be close to or above [30-40]%.

The Commission considers that the Transaction will not give rise to horizontal non-coordinated effects  at  worldwide  level  for  the  following
reasons.

First, post-transaction, there will continue to be strong suppliers active in the market, namely Ericsson (which will remain the  market  leader,
with a market share four percentage point greater than the merged entity), Huawei, ZTE and Samsung. Not only Ericsson and Huawei,  but  also  ZTE
and Samsung, will continue to represent credible alternatives for customers going forward, in particular in relation to 4G and,  in  the  future,
5G equipment (as well as 3G equipment in relation to ZTE).

With regard to ZTE, while it has a market share of [5-10]% by revenues, according to the data provided by the Notifying Party based  on  Dell'Oro
Report, ZTE's revenues related to worldwide sales of RAN equipment have been steadily growing in the last years, corresponding to an increase  of
almost [30-40]% (comparing 2012 revenues with 2014 data). As from 2012 until May  2015  ZTE  has  been  awarded  an  ever  increasing  number  of
contracts for the supply of RAN equipment worldwide. The majority of  customers  who  replied  to  the  market  investigation  acknowledge  ZTE's
presence among the main suppliers of RAN equipment worldwide and do not consider it as only a regional player.[55]

As regards Samsung, its small market share in the overall RAN equipment market does not fully reflect the competitive importance of its  offering
and mainly depends on the fact that Samsung started offering 4G equipment outside Korea later than its  competitors.  Samsung  has  been  gaining
footprint in 4G equipment and, according to the data provided by the Notifying Party based on Dell'Oro Report, its revenues related to  worldwide
sales of RAN equipment have been steadily growing in the last years, corresponding to an increase of [60-70]% (comparing 2012 revenues with  2014
data). Samsung is expected to have an important offering for 5G equipment. Indeed it is expected that Samsung will play an  active  role  in  the
first deployment of this technology in South Korea (once its standards will be defined). This has  been  confirmed  by  the  respondents  to  the
market investigation, who explained that it is expected that Samsung will increase its  presence  in  the  EEA  both  in  4G  equipment  and,  in
particular, in 5G equipment, when this technology will be developed.[56] The Parties' internal documents describe Samsung as a "threat - e.g.  to
pricing and disruptive tenders with financial muscles-," with a "strong presence in key large customers (KDDI, Sprint, Reliance)" worldwide.

Second, the Parties do not appear to be close competitors. This is in  particular  because  of  the  different  geographic  focus  of  their  RAN
businesses. Indeed, as shown by the above Table 3, Nokia has a strong presence in EEA, while Alcatel has only  a  [5-10]%  market  share.  Market
shares figures related to other regions of the world similarly show that the Parties' geographic presence is complementary,  with  Alcatel  being
strong in markets where Nokia has less than [10-20]% market share, and vice versa. For example, the figure below shows the  Parties'  positioning
in North America ("NAM") and Asia and the Pacific region ("APAC") with regard to 4G (LTE) RAN equipment.

                                     Figure 2: Competitive landscape in NAM and APAC, 4G (LTE) RAN equipment,
                                                               second quarter 2014

                                                                       […]

The fact that the Parties are not close competitors has been confirmed by the results of the market  investigation  and  by  the  review  of  the
Parties’ internal documents. Indeed, the majority of customers responding to the market investigation  consider  the  Parties  not  to  be  close
competitors at worldwide level: in their view, Nokia's and Alcatel's offerings focus their activities to different network segments  and  network
elements. Several customers also point to the different  geographic  focus  of  Alcatel's  and  Nokia's  activities.[57]  The  Parties'  internal
documents show that, although they monitor the competitive activity of all suppliers of RAN equipment, Alcatel and Nokia  do  not  look  at  each
other as point of reference when taking strategic decision. In particular,  from  Nokia's  internal  documents  it  is  clear  that  its  closest
competitor is Ericsson, having a similar strong presence in EEA.[58]

In addition, despite the symmetry in market shares between the merged entity, Ericsson and Huawei,  the  Commission  considers  that  Transaction
does not give rise to horizontal coordinated effects at worldwide level for the following reasons.

First, reaching terms of coordination does not seem to be easy, as the RAN equipment market is driven by technological innovation which can  have
disruptive effects on the market structure, as explained in paragraph (18) above.[59] The ability to innovate is strategic for  RAN  vendors  and
this will not change post-transaction. In a similar vein, the reduction in the number of firms  on  the  market  and  the  increment  brought  by
Alcatel to Nokia's pre-Transaction position is not such to significantly change the pre-transaction structure making it more easy to reach  terms
of coordination.[60] Also, the Commission’s investigation did not  reveal  any  evidence  of  pre-Transaction  coordination  or  of  attempts  to
coordinate in the market.[61]

Second, the market does not appear to be transparent. Contracts are allocated via tenders, in which the identity of  the  competing  bidders  and
the price levels are typically not transparent.[62]

Third, RAN equipment market place is characterized by a few large, high value orders. This characteristic  makes  it  difficult  to  establish  a
sufficiently severe deterrent mechanism, since the gain from deviating at the right time (e.g., when a particularly  sizeable  tender  comes  up)
may be large, certain and immediate, whereas the losses from being punished would be uncertain and only materialize after some time. In  fact,  a
call for tender does not necessarily mean that the project will finally materialize and that the deviating behaviour  will  be  detected  by  the
other coordinating firms.[63]

Moreover, the Commission considers that the Transaction will not give rise to horizontal  non-coordinated  effects  at  the  EEA  level  for  the
following reasons.

First, the increment brought by Alcatel to the combined entity market share is limited. Alcatel only adds [5-10]% to Nokia's  pre-existing  share
in the EEA.

Second, post-transaction, there will continue to be strong suppliers active in the market, namely Ericsson and Huawei with  a  share  similar  to
that of the merged entity, as well as ZTE and Samsung, although with a much smaller share.  Like  at  worldwide  level,  not  only  Ericsson  and
Huawei, but also ZTE and Samsung, will continue to represent credible alternatives for customers going forward  in  the  EEA,  in  particular  in
relation to 4G and, in the future, 5G equipment (as well as 3G equipment in relation to ZTE).

While ZTE is a small player in the EEA market, it does offer quality RAN mono-technology equipment  and  SRAN,  to  which  EEA  customers  attach
particular importance. The fact that ZTE constitutes a reliable alternative in the EEA has been confirmed by  the  large  majority  of  customers
responding to the market investigation. They pointed to ZTE having a wide portfolio of RAN solutions (2G, 3G,  4G),  as  well  as  an  attractive
portfolio of SRAN.[64] The Commission notes that, on the basis of Dell'Oro figures provided by the Notifying Party,  ZTE's  revenues  related  to
EEA sales of RAN equipment have been growing in the last years, corresponding to an increase of almost [10-20]%  (comparing  2012  revenues  with
2014 data).

As regards Samsung, its small market share in the overall RAN equipment market depends on the fact that Samsung started offering 4G equipment  in
the EEA later than its competitors and it does not fully reflect its competitive potential as explained in paragraph  (87)  above.  Moreover,  as
explained in paragraph (87) above, Samsung is expected to have an important offering for 5G equipment. The Commission notes that,  on  the  basis
of Dell'Oro figures provided by the Notifying Party, Samsung's revenues related to EEA sales of RAN equipment considerably increased in the  last
years, from approximately EUR […] million in 2012, to EUR […] million in 2013 and EUR  […]  million  in  2014,  what  evidences  an  increase  in
customer orders in the EEA.

Third, the Parties do not appear to be close competitors. For example, in terms of product  offering,  Alcatel  currently  does  not  offer  SRAN
equipment, which is an important product for EEA customers, while Nokia offers this product. Moreover, Alcatel is  a  small  player  in  the  EEA
market, while Nokia is a larger provider, who competes head to head  with  Ericsson  and  Huawei.  The  fact  that  the  Parties  are  not  close
competitors has been confirmed by the results of the market investigation and by the  review  of  the  Parties’  internal  documents.  The  large
majority of the customers who replied to the market investigation consider that Nokia and Alcatel-Lucent are not close competitors at EEA  level.
This reflects the fact that Alcatel does not offer SRAN equipment and that Alcatel is also perceived as being a weak competitor in  the  EEA,  as
well as the product and geographic complementarity of Nokia and Alcatel's  offers.[65]  As  explained  in  paragraph  (89)  above,  the  Parties'
internal documents show that, although they monitor the competitive activity of all suppliers of RAN equipment, Alcatel and Nokia do not look  at
each other as point of reference when taking strategic decision.

Furthermore, despite the symmetry in market shares between the merged entity, Ericsson and Huawei, the Commission considers that the  Transaction
does not give rise to horizontal coordinated effects at EEA level for the same reasons explained in paragraphs (91)-(93).  Moreover,  the  market
share increment brought by Alcatel to Nokia’s pre-Transaction position in the EEA is lower than at worldwide level, so that the  likelihood  that
the Transaction will increase the risks of coordination is even more remote.

Finally, the Commission notes that customers have raised no concern with respect to possible horizontal non-coordinated  or  coordinated  effects
of the Transaction. On the contrary, virtually unanimously, the customers who replied to the market investigation consider the overall impact  of
the Transaction on the RAN market to be neutral, with some customers even  considering  that  the  Transaction  may  have  a  positive  and  pro-
competitive effect both at worldwide and at EEA level: in their view the Transaction would indeed strengthen  Nokia's  and  Alcatel's  respective
proposition to customers and guarantee viable competition going forward in the RAN equipment market place.[66]

Only two competitors voiced complaints on the effects of the Transaction on the market for RAN equipment,  in  terms  of  increased  barriers  to
entry and expansion. In particular, one competitor claims that the Transaction will result in the three largest vendors  occupying  the  majority
of the market for RAN equipment, making it more difficult for new players to enter in the market and to compete, since  no  level  playing  field
would be guaranteed. The competitor also considers that the incumbent vendors have an inherent advantage over other  players,  since  every  next
technology generation product will also need to support the previous generations already deployed.  Moreover,  the  complainant  fears  that  the
transaction would exacerbate current practices of incumbent RAN and other mobile  infrastructure  equipment  vendors  to  the  detriment  of  new
players, that is, in particular, (i) lack of cooperation on interoperability tests, (ii) predatory pricing aiming at  locking  in  customers  and
(iii) exclusivity or best customer clauses in contracts with sub-contractors. A similar complaint has been expressed by another  competitor,  who
considers that the merged entity would benefit of increased economies of scale, which would likely constrain the gross  margins  available  to  a
new entrant.

The Commission considers these complaints not to be sufficiently substantiated. Moreover, the  Commission’s  investigation  did  not  reveal  any
merger-specific factor that would have an impact on the existing barriers to entry/expansion in the provision of RAN  equipment.  The  Commission
therefore considers that the Transaction will not have any material impact on such barriers.

In the light of the above the Commission considers that the Transaction does not raise serious doubts with regard to its compatibility  with  the
internal market in the possible market for RAN equipment, both at EEA level and worldwide.

2 RAN equipment based on 4G LTE technology

As regards the possible market segment for RAN equipment based on 4G/LTE technology, the Parties' and their main competitors' market  shares  are
illustrated in the below Table 4.

                                 Table 4: Market shares of 4G LTE at worldwide and EEA level for 2014 by revenue

|                            |Worldwide                       |EEA                             |
|Nokia                       |[10-20]%                        |[20-30]%                        |
|Alcatel                     |[10-20]%                        |[5-10]%                         |
|Combined                    |[30-40]%                        |[20-30]%                        |
|Ericsson                    |[20-30]%                        |[30-40]%                        |
|Huawei                      |[20-30]%                        |[30-40]%                        |
|ZTE                         |[5-10]%                         |[0-5]%                          |
|Samsung                     |[5-10]%                         |[0-5]%                          |

Source: Annex 7 to the Form CO

As shown in the above table, the Parties' combined market shares by revenue in the possible  sub-segment  for  RAN  equipment  based  on  4G  LTE
technology would be approximately [30-40]% or close to [30-40]% in both the possible worldwide and EEA markets.

The Commission considers that the Transaction will not give rise to horizontal non-coordinated effects  at  worldwide  level  for  the  following
reasons.

First, the Transaction does not reduce the number of alternative 4G RAN suppliers active in the market worldwide in  a  way  which  could  hamper
competition. Post-transaction there will continue to be strong suppliers, namely Ericsson (with a comparable share of [20-30]%) and Huawei  ([20-
30]%), as well ZTE and Samsung.

With regard to ZTE, while it still has a market share of [5-10]%, according to the data  provided  by  the  Notifying  Party  based  on  Dell'Oro
Report, ZTE's revenues related to worldwide sales of RAN equipment based on 4G LTE technology have been steadily growing in the  last  years  and
in 2014 were reported to be almost 5.5 times greater than in 2012. This is mainly due  to  the  award  of  contracts  for  the  roll  out  of  4G
technology in China. Nonetheless also the customers contacted by the Commission (mainly with operations in the EEA,  but  also  in  the  rest  of
Europe, North America and Latin America) consider ZTE as a reliable alternative supplier for 4G/LTE technology.[67]

As for Samsung, as explained in paragraph (87), its small market share does not fully represent its  competitive  importance.  Samsung  has  been
gaining important contracts for the roll out of 4G RAN equipment: its customer base includes mobile network operators such as Sprint  in  the  US
and KDDI in Japan. According to the data provided by the Notifying Party based on Dell'Oro Report, its revenues related  to  worldwide  sales  of
RAN equipment based on 4G/LTE technology have increased by 2.6 times in two years, from 2012 to 2014. The majority of respondents to  the  market
investigation consider Samsung as a reliable alternative supplier having good 4G technology.[68]

Second, the Parties do not appear to be close competitors for the same reasons explained in paragraphs (88) and (89) above.

In addition, despite the symmetry in market shares between the merged entity, Ericsson and Huawei, the Commission considers that the  Transaction
does not give rise to horizontal coordinated effects at worldwide level, for the same reasons stated in paragraphs (91)-(93).

Moreover, the Commission considers that the Transaction will not give rise to horizontal  non-coordinated  effects  at  the  EEA  level  for  the
following reasons.

First, the increment brought by Alcatel to the combined entity market share is limited, Alcatel only adding approximately [5-10]% to Nokia's pre-
existing share in the EEA.

Second, the Transaction does not reduce the number of alternative 4G RAN suppliers active in the market in a way which would hamper  competition.
Other strong players will remain in the market, namely Ericsson and Huawei, which will be respectively the first and second market  players,  but
also Samsung and ZTE for the reasons explained in paragraphs (97) and (98) above.

Third, the Parties do not appear to be close competitors for the reasons explained in paragraph (99).

In addition, despite the symmetry in market shares between the merged entity, Ericsson  and  Huawei,  the  Transaction  does  not  give  rise  to
horizontal coordinated effects at EEA level for the reasons discussed in paragraph (100).

Finally, as explained in paragraph (101), virtually all customers replying to the  market  investigation  consider  the  overall  impact  of  the
Transaction on the RAN market to be neutral or positive both at worldwide and EEA level.

In the light of the above, the Commission considers that the Transaction does not raise serious doubts with regard to its compatibility with  the
internal market in the possible market segment for RAN equipment based on 4G LTE technology, both at EEA level and worldwide.

3 RAN equipment based on 3G technology

As regards the possible market segment for RAN equipment based on 3G technology, the Parties' and  their  main  competitors'  market  shares  are
illustrated in the below Table 5.

                                   Table 5: Market shares of 3G at worldwide and EEA level for 2014 by revenue

|                            |Worldwide                    |EEA                          |
|Nokia                       |[20-30]%                     |[30-40]%                     |
|Alcatel                     |[0-5]%                       |[5-10]%                      |
|Combined                    |[20-30]%                     |[30-40]%                     |
|Ericsson                    |[40-50]%                     |[30-40]%                     |
|Huawei                      |[20-30]%                     |[20-30]%                     |
|ZTE                         |[0-5]%                       |[0-5]%                       |

Source: Annex 7 to the Form CO

As shown in the above Table 5, with respect to RAN equipment based on 3G technology, the Parties' combined market  shares  by  revenue  would  be
approximately [20-30]% at worldwide level and close to [40-50]% in the EEA.

The Commission considers that the Transaction will not give rise to horizontal non-coordinated effects  at  worldwide  level  for  the  following
reasons.

First, as explained in paragraph (10), 3G, while still being widely used and to some extent rolled-out, is considered a mature  technology  given
that in many countries 3G networks have already been deployed for quite some time. From the perspective of suppliers of RAN equipment,  sales  of
3G (WCDMA) network equipment have been gradually replaced by the sales of newer generation 4G LTE network equipment. Figure 1 above clearly  show
this trend toward a gradual reduction of RAN suppliers' revenues and mobile operators' expenditure related to 3G RAN equipment.

Second, at worldwide level, the presumption of compatibility with the internal market  set  forth  in  paragraph  18  of  the  Horizontal  Merger
Guidelines applies, as the merged entity's market share does not exceed 25%. Moreover, the increment brought by Alcatel to  the  combined  entity
market share is limited, Alcatel only adding [0-5]% to Nokia's pre-existing share worldwide.

Third, the Commission notes that Alcatel's sales in the 3G RAN equipment segment are set to decline as a  consequence  of  the  company's  recent
strategic decision in 2013[69] to no longer develop its 2G and 3G business. Alcatel now outsources all 2G  and  3G  technical  support  services,
design, development, and testing to the India-based company HCL. Alcatel’s 3G revenue dropped by [70-80]% from 2012 to 2014,  while  the  market-
wide 3G revenues declined by less than [30-40]% in the same time period. Alcatel's share worldwide in the 3G segment decreased from [20-30]%   in
2012 to [0-5]%  in 2014.

Fourth, in light of Alcatel's above-mentioned strategic decision, the Transaction does not reduce the number of alternative suppliers  active  in
the market for RAN equipment based on 3G technology. Indeed, for the reasons outlined in paragraph  (125),  Alcatel  is  not  likely  to  play  a
significant competitive constraint in the market, so that the competitive landscape would not be significantly changed.  Moreover,  Ericsson  and
Huawei have larger market shares worldwide than the merged entity.

In addition, despite the symmetry in market shares between the merged entity, Ericsson and Huawei, the Commission considers that the  Transaction
does not give rise to horizontal coordinated effects at worldwide level. The Commission acknowledges that the market for RAN equipment  based  on
3G technology is not particularly innovation driven, given that it is a mature technology. Nonetheless, the  Commission  also  notes  that,  with
regard to mature technologies, deployments have mostly already been completed, and demand for  these  products  in  developed  geographies,  like
North America, EEA or Japan, is expected to be limited to maintenance and gap-filling of current networks. As a consequence,  sales  in  relation
to mature technologies are expected to be essentially limited to sales to existing customers by the  incumbent  supplier  or  small  tenders  for
limited gap-fill projects, and this until the replacement by newer technologies will be completed. In this context, on  balance,  the  Commission
considers that even if reaching terms of coordination with respect to the sale of 3G RAN equipment  would  be  possible,  for  lack  of  economic
incentive, it is unlikely. Given the declining potential revenue (even if higher prices above the competitive level could be set as a  result  of
possible coordinated effort in this direction) that can be  derived  from  a  market  with  diminishing  economic  significance  as  the  3G  one
(especially in comparison with the revenues generated on the 4G market as shown in Figure 1),  it  does  not  appear  economically  rational  for
market players to engage in coordination. Moreover, horizontal coordinated effects can be excluded for the reasons explained in  paragraphs  (98)
to (99) above.

Moreover, the Commission considers that the Transaction will not give rise to horizontal  non-coordinated  effects  at  the  EEA  level  for  the
following reasons.

First, as explained in paragraph (123), 3G RAN equipment is a mature technology and RAN suppliers' revenues  and  mobile  operators'  expenditure
related to its sale are expected to decrease.

Second, the increment brought by Alcatel to the combined entity market share is limited, Alcatel only  adding  [5-10]%  to  Nokia's  pre-existing
share in the EEA.

Third, as explained in paragraph (125), Alcatel's sales in the 3G segment are continuing to decline as a  consequence  of  the  company's  recent
strategic decision to no longer develop its 2G and 3G business.

Forth, as a result of Alcatel's small market presence and cessation of development activity in this market  segment,  the  Transaction  does  not
reduce the number of alternative suppliers active in the market  for  RAN  equipment  based  on  3G  technology  in  a  way  which  would  hamper
competition.

Fifth, the Parties do not appear to be close competitors, for the reasons explained in paragraph (99).

Furthermore, despite the symmetry in market shares between the merged entity, Ericsson and Huawei, the Commission considers that the  Transaction
does not give rise to horizontal coordinated effects at EEA level, for the same reasons stated in paragraph (127).

Finally, as explained in paragraph (93), virtually all customers replying to  the  market  investigation  consider  the  overall  impact  of  the
Transaction on the RAN market to be neutral or positive both at worldwide and EEA level.

In the light of the above the Commission considers that the Transaction does not raise serious doubts with regard to its compatibility  with  the
internal market in the possible market segment for RAN equipment based on 3G technology, both at EEA level and worldwide.

4 RAN equipment based on 2/2.5G GSM/GPRS/EDGE technology

As regards the possible market segment for RAN equipment based on 2/2.5G GSM/GPRS/EDGE technology,  the  Parties'  and  their  main  competitors'
market shares in the market are illustrated in the below Table 6.

                          Table 6: Market shares of 2/ 2.5G GSM/GPRS/EDGE at worldwide and EEA level for 2014 by revenue

|                          |Worldwide                     |EEA                           |
|Nokia                     |[20-30]%                      |[20-30]%                      |
|Alcatel                   |[5-10]%                       |[0-5]%                        |
|Combined                  |[20-30]%                      |[20-30]%                      |
|Ericsson                  |[30-40]%                      |[30-40]%                      |
|Huawei                    |[20-30]%                      |[30-40]%                      |
|ZTE                       |[5-10]%                       |[5-10]%                       |

Source: Annex 7 to the Form CO

As shown in the above table, with respect to the market for RAN equipment based on  2/2.5G  (GSM/GPRS/EDGE)  technology,  the  Parties'  combined
market shares by revenue would be above [20-30]% only at worldwide level, where, nonetheless, it does not exceed  [30-40]%.  In  the  EEA  market
segment the presumption set forth in paragraph 18 of the Horizontal Merger Guidelines applies, the merged entity's  market  share  not  exceeding
25%.

The Commission considers that the Transaction will not give rise to horizontal non-coordinated effects  at  worldwide  level  for  the  following
reasons.

First, as it is the case for 3G, 2G/2.5G (GSM/GPRS/EDGE) can be considered a legacy technology and it is set to be completely substituted  by  3G
and 4G. Since the relevant networks have been already rolled out, its revenues are expected to  decrease  till  approaching  zero,  as  shown  by
Figure 1 above.

Second, the increment brought by Alcatel to the combined entity market share is limited, Alcatel only  adding  [5-10]%  to  Nokia's  pre-existing
share worldwide.

Third, Alcatel's sales are continuing to decline as a consequence of the company's recent strategic decision to no longer develop its 3G  and  2G
business, as explained in paragraph (125).

Fourth, the Transaction does not reduce  the  number  of  alternative  suppliers  active  in  the  market  for  RAN  equipment  based  on  2/2.5G
(GSM/GPRS/EDGE) in a way which would hamper competition, as in any event Alcatel has a small market  presence  and  has  ceased  its  development
activity in this market segment. Moreover, Ericsson, with a market share of approximately [30-40]%, will remain the  clear  market  leader  post-
Transaction and also Huawei would keep a significant presence ([20-30]%).

Fifth, the Parties do not appear to be close competitors for the reasons explained in paragraph (99).

In addition, despite the symmetry in market shares between the merged entity, Ericsson and Huawei, the Commission considers that the  Transaction
does not give rise to horizontal coordinated effects at worldwide level, for the reasons explained in paragraph (127).

Moreover, the Commission considers that the Transaction does not give rise to horizontal non-coordinated  effects  at  EEA  level  for  the  same
reasons stated in paragraphs (129) to (133)

Furthermore, despite the symmetry in market shares for the merged entity, Ericsson and Huawei, the Commission  considers  that  Transaction  does
not give rise to horizontal coordinated effects at EEA level, for the same reasons stated in paragraph (127).

Finally, as explained in paragraph (97), virtually all customers replying to  the  market  investigation  consider  the  overall  impact  of  the
Transaction on the RAN market to be neutral or positive both at worldwide and EEA level.

In the light of the above the Commission considers that the Transaction does not raise serious doubts with regard to its compatibility  with  the
internal market in the possible market segment for RAN equipment based on 2/2.5G GSM/GPRS/EDGE technology, both at EEA level and worldwide.

5 RAN equipment based on 2G CDMA technology

As regards the possible market segment for RAN equipment based on 2G CDMA technology,[70] the Parties' and their main competitors' market  shares
are illustrated in the below Table 7.

                                     Table 7: Market shares of 2G CDMA at worldwide level for 2014 by revenue

|                            |Worldwide                               |
|Nokia                       |[5-10]%                                 |
|Alcatel                     |[40-50]%                                |
|Combined                    |[50-60]%                                |
|Ericsson                    |[10-20]%                                |
|Huawei                      |[10-20]%                                |
|ZTE                         |[10-20]%                                |

Source: Annex 7 to the Form CO

As shown in the above table, the Parties' combined market share by revenue would be approximately [50-60]% in the possible worldwide  market  for
RAN equipment based on 2G CDMA technology.

The Commission considers that the Transaction does not give rise to horizontal non-coordinated effects  at  worldwide  level  for  the  following
reasons.

First, as already explained in paragraph (10), 2G (CDMA) constitutes a legacy technology, and total CDMA revenues are expected  to  significantly
decrease till reaching zero by 2016, as shown in Figure 1. In 2014, on the basis of Dell'Oro figure  provided  by  the  Parties,  2G  (CDMA)  RAN
equipment revenues accounted for USD 1.2 billion worldwide, representing 3.5% of total worldwide RAN revenues: by way of comparing,  in  2012  2G
(CDMA) RAN equipment revenues accounted for 12% of total worldwide RAN revenues. Competition among vendors for 2G (CDMA) RAN is rare, since  CDMA
networks have already been rolled out and all contracts have been awarded.

Second, the increment brought by Nokia to the combined entity market share is limited,  Nokia  only  adding  [5-10]%  to  Alcatel's  pre-existing
share. Alcatel's large share in CDMA corresponds primarily to its legacy position in North America.[71]

Third, the Commission notes that, as explained in paragraph (125), Alcatel's sales in the 2G (CDMA) RAN equipment segment are set to  decline  as
a consequence of the company's recent strategic decision to no longer develop its 2G and 3G business.

Fourth, as explained in paragraph (97), virtually all customers replying  to  the  market  investigation  consider  the  overall  impact  of  the
Transaction on the RAN market to be neutral or positive.

Finally, the Commission notes that 2G (CDMA) technology has not been deployed in the EEA, nor sales of RAN equipment  based  on  this  technology
have been made in the recent past, nor are expected in the future, in the EEA. Therefore the impact of the Transaction in  the  worldwide  market
for 2G (CDMA) RAN equipment would not affect the internal market.

In the light of the above, the Commission considers that the Transaction does not raise serious doubts with regard to its compatibility with  the
internal market in the possible market segment for RAN equipment based on 2G CDMA technology worldwide.

3 Conclusion on RAN

Given the above, the Commission considers that the Transaction does not raise serious doubts with regard to its compatibility with  the  internal
market in the overall market for the supply of RAN equipment, as well as in any of its possible market segments, both in the EEA and worldwide.

3  CNS solutions

1 Notifying Party's view

The Notifying Party claims that the there is a strong ongoing shift in the entire CNS industry from hardware-based technology  to  software-  and
cloud-based technology. This shift is accompanied by rapid growth in data traffic with unpredictable traffic patterns resulting in new  offerings
such as Software Defined Networking ("SDN") technology[72] which can be applied to a core network in order to create a  virtualized  LTE  network
and Network Function Virtualization ("NFV") which allows the software that historically has been installed on  hardware  devices  to  be  run  on
general purpose servers equipped with virtualization software system. According to the Notifying Party these  trends  enable  new  entrants  that
traditionally are software-focused to start competing with the traditional CNS vendors by  offering  virtualized  core  products.  The  Notifying
Party claims that the CNS market is characterised by strong competition from a number of other CNS solutions  providers  and  by  rapid  pace  of
innovation.

The Notifying Party further submits that the Transaction will allow the Parties to better compete in the CNS solution business in the future  and
in view of the numerous suppliers that will continue to exercise competitive pressure on the merged entity the Transaction does not give rise  to
any competition concerns.

As regards Wireless Packet Core products the Notifying Party submits that network operators  in  general  purchase  Wireless  Packet  Core  as  a
complete solution from one vendor. However the Notifying Party notes that due to the standardisation of each of the components  of  the  Wireless
Packet Core the operators can purchase the different components from different vendors if  they  wish  to  do  so  for  technical  or  commercial
reasons. The Notifying Party also restates its claims that the ongoing industry trend towards  virtualization  is  affecting  also  the  Wireless
Packet Core products opening market opportunities for the entry and expansion of new players such as Mavenir  or  Affirmed  Networks  to  compete
with traditional core vendors for the provision of NFV solutions.

The Notifying Party submits that similarly to the Wireless Packet Core, in general Carrier IP telephony products  are  purchased  as  a  complete
solution from one vendor and given that its components and sub-components are standardised, purchasing these components  from  different  vendors
is not unusual for operators that seek to optimise the technical aspects of their networks to suit their  specific  needs.  The  Notifying  Party
further submits that the virtualization trend affects also Carrier IP telephony solutions which are becoming  increasingly  virtualised  allowing
new competitors such as Genband and Mavenir to offer virtualized solutions next to the Carrier IP solutions provided by traditional vendors.

According to the Notifying Party a convergence between OSS software for fixed lines and for mobile networks is taking place  and  all  major  OSS
vendors have already developed integrated fixed-mobile services support system solutions.

The Notifying Party submits that SON is an integral part of OSS software and all OSS vendors,  including  the  Parties,  offer  a  SON  solution.
According to the Notifying Party market shares for decentralized SON should correspond to the respective market shares for  OSS  software  (which
for the merged entity at EEA level in 2014 amount to [20-30]% and at worldwide level to [10-20]%). As regards the  market  share  of  the  merged
entity in a possible separate C-SON market the Notifying Party estimates it to be below 20% both globally and  at  EEA  level.  In  addition  the
Notifying Party submits that there is a strong competition in C-SON solutions from network vendors such as Ericsson, Huawei,  Samsung  and  Cisco
but also from smaller innovative players, dedicated exclusively to the development of C-SON like Cellwize, Amdocs, Arieso, Astellia and  Comarch.

2 Commission's assessment

1 Wireless Packet Core products

The Parties' and their main competitors' shares in relation to Traditional Packet Core and SGSN products at worldwide level  are  illustrated  in
Table 8 below.

                         Table 8: Market shares of Wireless Packet Core providers at worldwide level for 2014 by revenue

|                               |All Traditional Packet Core                 |SGSN                         |
|Nokia                          |[10-20]%                                    |[20-30]%                     |
|Alcatel                        |[0-5]%                                      |[0-5]%                       |
|Combined                       |[20-30]%                                    |[20-30]%                     |
|Ericsson                       |[30-40]%                                    |[20-30]%                     |
|Huawei                         |[20-30]%                                    |[30-40]%                     |
|Cisco                          |[10-20]%                                    |[5-10]%                      |
|ZTE                            |[5-10]%                                     |[5-10]%                      |

Source: Annex 8 to the Form CO

As shown by the above Table, the Parties' combined market shares by revenue would not exceed 25%, so that the presumption set forth in  paragraph
18 of the Horizontal Merger Guidelines applies to both the Traditional Packet Core and SGSN market  segments.  Moreover  Alcatel's  increment  in
these two possible segments is insignificant, below [0-5]%.

In any event, as supported by the results of the market investigation,[73] a  number  of  competitors  will  remain  post-Transaction,  including
competitors that are larger than the merged entity (Ericsson and Huawei), as well as smaller emerging players, such as Cisco.

The Commission also notes that that the Traditional Packet Core supports 3G RAN, which becomes increasingly mature and  the  current  competition
is shifting towards 4G and the corresponding Evolved Packet Core (which is not an affected market). Furthermore, typically the SGSN support  node
element is not sold as a separate product, but as part of an overall Traditional Packet Core solution, together with the GGSN component.

In light of the above, the Commission considers that the Transaction does not raise serious doubts with regard  to  its  compatibility  with  the
internal market in the possible worldwide market segments for Traditional Packet Core and SGSN.

2 Carrier IP telephony products

The Parties' and their main competitors' market shares in the  possible  affected  market  segments  at  worldwide  level  and  in  the  EEA  are
illustrated in the below Tables 9 and 10.

                  Table 9: Market shares for Carrier IP telephony solutions and components at worldwide level for 2014 by revenue

|Worldwide                |All Softswitches     |Softswitches wireless|All IMS Core    |IMS CSCF         |IMS HSS           |
|Alcatel                  |[5-10]%              |[0-5]%               |[5-10]%         |[10-20]%         |[5-10]%           |
|Combined                 |[20-30]%             |[20-30]%             |[20-30]%        |[30-40]%         |[20-30]%          |
|Huawei                   |[10-20]%             |[10-20]%             |[10-20]%        |[20-30]%         |[10-20]%          |
|Genband                  |[10-20]%             |-                    |[0-5]%          |[0-5]%           |[0-5]%            |
|ZTE                      |[10-20]%             |[10-20]%             |[0-5]%          |[0-5]%           |[0-5]%            |
|Metaswitch               |[0-5]%               |-                    |-               |-                |-                 |

Source: Annex 8 to the Form CO

                    Table 10: Market shares for Carrier IP telephony solutions and components at EEA level for 2014 by revenue

|EEA                     |All Softswitches                   |All Media Gateway                     |
|                        |(wireline + wireless)              |(wireline + wireless)                 |
|Nokia                   |[20-30]%                           |[20-30]%                              |
|Alcatel                 |[0-5]%                             |[0-5]%                                |
|Combined                |[20-30]%                           |[20-30]%                              |
|Ericsson                |[20-30]%                           |[10-20]%                              |
|Huawei                  |[5-10]%                            |[10-20]%                              |
|Genband                 |[20-30]%                           |[10-20]%                              |
|ZTE                     |[0-5]%                             |[0-5]%                                |
|Metaswitch              |[5-10]%                            |[5-10]%                               |

Source: Annex 8 to the Form CO

The Parties' combined market shares by revenue would be below 25%, and therefore the presumption set forth in  paragraph  18  of  the  Horizontal
Merger Guidelines applies, in all possible affected market segments, at worldwide and EEA level, with  the  exception  of  the  worldwide  market
segments for the IMS CSCF, where the merged entity's share amounts to [30-40]%, and the EEA market for all Softswitches (see Table 9 above).

With regard to affected segments for Softswiches (namely all Softswitches and wireless Softswitches), the  Commission  notes  that  at  worldwide
level, the merged entity's combined market shares only marginally exceed the threshold of an affected market  and  that  Alcatel's  increment  to
Nokia's pre-existing shares is limited or negligible (less than [0-5]% for  wireless  Softswitches  and  [5-10]%  for  all  Softswitches).  Post-
Transaction other strong competitors in the face of Ericsson (whose market share of [30-40]% or [40-50]%,  depending  on  the  segment,  will  be
significantly higher than the one of the merged entity), Huawei ([10-20]%) and ZTE ([10-20]%) will continue  to  exert  competitive  pressure  as
supported also by the results of the market investigation.[74]

In the possible EEA market segments for all Softswitches (wireless and wireline), the merged entity's market shares  would  reach  [20-30]%  (see
Table 10). The increment brought by Alcatel to the pre-existing Nokia market share is limited ([0-5]%). Moreover, as confirmed by the results  of
the market investigation in this case,[75] a sufficient number of alternative suppliers with sizeable market shares will  remain  on  the  market
post-transaction, including Ericsson ([20-30]%) and Genband ([20-30]%). Finally there is no direct competition between  the  Parties  given  that
Alcatel's business focus is wireline products, while it is not active with respect to  Wireless  Softswitches,  and  viceversa  Nokia's  business
focus is wireless solutions, while it has limited presence in these wireline products.

With respect to the market segment for all Media Gateways (wireless and wireline), the merged entity's market shares would reach [20-30]% in  the
EEA. The increment brought by Alcatel to the pre-existing Nokia market share is very limited ([0-5]%). Moreover, as confirmed by the  results  of
the market investigation in this case,[76] a sufficient number of alternative suppliers with sizeable market shares will  remain  on  the  market
post-transaction, including Ericsson ([10-20]%), Huawei ([10-20]%) and Genband ([10-20]%). Finally there is no  direct  competition  between  the
Parties given that Alcatel is not active with respect to wireless Media Gateway components, where Nokia's business  is  focused,  and  Nokia  has
limited presence in these wireline products, where Alcatel's business is concentrated.

As regards IMS Core and its components at worldwide level, the Commission notes that the combined market shares would exceed [20-30]%  only  with
respect to the CSCF component, reaching [30-40]% according to market share data estimated by Dell'Oro.  Nonetheless  the  Commission  also  notes
that IMS Core solutions are typically sold as an integrated product, including both CSCF and HSS components, and that its components are  rarely,
if at all, sold separately.[77] In any event, even with respect to CSCF products, post-Transaction there will remain other alternative  providers
with  sizeable  market  presence,  namely  Ericsson  ([20-30]%)  and  Huawei  ([20-30]%).  Furthermore,  the  technology  change  trends  towards
virtualization and development of IMS Core as an entirely software-based application enable (and will continue to enable)  new  competitors,  not
focused on the traditional core equipment, to enter and compete with the merged entity.

In light of the above, the Commission considers that the Transaction does not raise serious doubts with regard  to  its  compatibility  with  the
internal market in the possible market segments for (i) Softswitches at EEA and at worldwide level; (ii) Media Gateway  products  at  EEA  level;
(iii) Wireless Softswitches at worldwide level; (iv) IMS Core products at worldwide level, including on the possible IMS Core  sub-segments  CSCF
and HSS at worldwide level.

3 OSS solutions

The combined market share of the Parties in the possible affected market for OSS software at EEA  level  amounts  to  [20-30]%  (Nokia  [10-20]%;
Alcatel [5-10]%). Therefore, the presumption set forth by paragraph 18 of the Horizontal Merger Guidelines applies.

The Commission considers that the Transaction will not give rise to horizontal non-coordinated effects at the EEA level.

Indeed, large competitors, whose market shares would be higher than the one of the merged entity will remain on the market and will  continue  to
exert significant competitive constraints on the combined entity like Ericsson ([30-40]%)  and  Huawei  ([30-40]%)  with  ZTE  and  Samsung  also
providing a competitive constraint on the merged entity.

The Commission also considers that the Parties' and competitors' OSS software products are largely specific to the equipment which  the  software
operates. As a consequence, the competitive dynamics in relation to OSS software solutions, including closeness of competition or –  as  concerns
the Parties – the lack thereof, follows the competitive dynamics in the respective equipment segments. On  this  basis,  the  Parties  cannot  be
considered close competitors.

As explained in paragraphs (43) ff. above, the OSS software is vertically related with C-SON. Both Nokia and Alcatel are OSS vendors and offer C-
SON solutions: Nokia's own C-SON offer has some limited multivendor capability, but in Nokia's  view  it  is  not  fully  multivendor,[78]  while
Alcatel has a C-SON solution which is compatible only with its own OSS and is therefore not a multivendor solution. Despite the  Parties'  market
presence at both level of the vertical relationship, no vertically affected market arise as the Parties' combined market shares in  all  possible
relevant market segments would be below [30-40]% (both at worldwide and EEA level).

As explained in paragraphs (43) ff. above, in order to develop a multivendor C-SON solutions both independent C-SON  providers  and  OSS  vendors
need to be able to use the network status information generated by the network equipment and available via the OSS interfaces. Although  the  OSS
interfaces are in general standardised, certain OSS vendors, among which the Parties, require a feature license in  order  to  allow  third-party
access and use of a particular kind of network status information in certain interfaces formats. In  some  cases  such  "case-specific"  licenses
could be included in the agreement between the mobile network operator and the provider of the network equipment or  could  be  negotiated  after
the deployment of the OSS equipment.

In this regard the Commission notes that in 2013 Nokia, jointly with  Ericsson  and  Huawei,  established  the  OSS  interoperability  initiative
("OSSii") with the aim of cross-licensing access to the respective participants' OSS interfaces on a bilateral basis and of providing  a  license
to any third party on fair, reasonable, and non-discriminatory  ("FRAND")  terms  with  respect  to  OSS  interfaces  and  interoperability  test
specifications. Through the OSSii interface initiative, the licensee would get access to the specifications and  testing  facilities  of  defined
Nokia interfaces towards Network Managers and other software that should enable the licensee to develop their product to interface  with  Nokia's
proprietary Network Element Manager. Under this initiative Nokia has granted licences to Ericsson and Huawei and also to Reverb. ZTE  decided  on
26 May 2015 to co-sign the OSSii agreement and publically committed to the OSSii principles.[79]

Alcatel on the other hand is not part of the OSSii initiative and any C-SON provider that want to access  its  OSS  interfaces  information  must
negotiate a licence with Alcatel on individual basis. Alcatel provides access to its Network  Element  Manager  via  its  OSS  Connected  Partner
Program.[80] […].

Although the majority of the customers that responded to the Commission's market investigation in this case consider that  the  Transaction  will
have no effects on their ability to source C-SON from different suppliers than OSS vendors[81] some concerns were voiced as to the effect of  the
Transaction on the ability of independent vendors to provide C-SON solutions. One particular issue raised by market players is that  the  licence
terms currently offered by Nokia under the OSSii initiative are restrictive in the sense that Nokia is unwilling to allow third party  access  to
certain network information considered to be "real-time" or "near real-time" with less than  15  minutes  response  cycle  thus  frustrating  the
development of more effective C-SON solutions and limiting the attractiveness of C-SON solutions to  operators  to  discourage  the  adoption  of
third-party C-SON solutions. Post-transaction Nokia's allegedly more restrictive approach regarding licensing access to this real-time/near real-
time data in OSS interfaces format could be extended to Alcatel (which so far was more prone to give access also to  these  "faster"  interfaces)
and C-SON providers would be foreclosed from accessing Alcatel's real-time and near-real time interfaces information.

The Commission considers that the Transaction will not give rise to input foreclosure effects for the following reasons.

The Commission recalls that in the present case the vertical relationship between OSS and C-SON does not give rise  to  any  vertically  affected
markets.

With regard to ability to foreclose, the Commissions notes that, according to the Non-Horizontal Merger Guidelines[82] for input  foreclosure  to
be a concern, the vertically integrated firm resulting from the merger must have a significant degree of market power  in  the  upstream  market.
The Commission notes in this respect that given the actual market shares of the merged entity in the upstream markets for OSS software  ([10-20]%
at worldwide level and [20-30]% in the EEA) and the number of upstream competitors as mentioned in paragraph (180), the merged  entity  does  not
seem to have a significant market power post-Transaction.

Furthermore, the Commission notes that Nokia committed to give access to its OSS interfaces on FRAND terms under the  OSSii.  If  Nokia  were  to
extend its licensing policy to Alcatel's interfaces post-transaction, it will be bound to FRAND terms as per  the  OSSii  initiative  commitments
also with respect to Alcatel's interfaces. With regard to licences already granted by Alcatel pre-transaction to  third  party  C-SON  providers,
based on the information available in its file, the Commission considers that the merged  entity  will  not  have  the  ability  to  unilaterally
terminate (or modify) the terms of those licence agreement. […]. Therefore, the merged  entity  will  not  have  in  particular  the  ability  to
foreclose third party's access to those of Alcatel's interfaces information which are not covered by the OSSii initiative,  if  such  access  has
already been negotiated and agreed on a contractual basis pre-Transaction.

Therefore, the Commission considers that the Transaction will not have an impact on Nokia’s ability to foreclose access to  its  own  interfaces.
The Commission also considers that the Transaction will also not have any  material  impact  on  Nokia’s  ability  to  foreclose  access  to  the
Alcatel’s interfaces since third parties having access to these interfaces pre-Transaction will continue to be protected both by  their  existing
agreements and, in any event, by Nokia’s FRAND licensing obligation that will be extended to the Alcatel’s interfaces.

As regards incentives to foreclose, the Commission considers that it is not clear whether  the  merged  entity  will  have  the  incentive  post-
Transaction to foreclose, either completely or partially, access to the data available through certain of Alcatel's OSS interfaces.

As regards the possible foreclosure effects, the Commission also notes that despite certain claims that accessing the real-time  and  near  real-
time network status information[83] could help C-SON developers to improve the performance  of  C-SON  solutions  making  them  more  robust  and
competitive, it also appears that C-SON solutions could be developed on the basis of the information that is subject to licensing on FRAND  terms
under the OSSii initiative. Moreover, it is possible that third party C-SON solution developers could  source  any  additional  information  that
they may need directly from the telecom operators.

The Commission also notes that, even if third party  C-SON  providers  were  to  be  somehow  foreclosed  from  accessing  certain  of  Alcatel's
interfaces, given the geographic focus of Alcatel's activities for OSS software (Alcatel's market shares at EEA level  amount  for  [5-10]%)  the
impact of such potential foreclosure in the EEA would be fairly limited.

In light of the above, the Commission concludes that the Transaction does not raise serious doubts with regard  to  its  compatibility  with  the
internal market in the possible market for OSS software at EEA level. The Commission also concludes that no foreclosure  effects  are  likely  to
arise in relation to access to OSS interfaces information on the possible market segment for C-SON solutions.

3 Conclusion on CNS solutions

Given the above, the Commission considers that the Transaction does not raise serious doubts with regard to its compatibility with  the  internal
market in any possible CNS market segments, both in the EEA and worldwide

4  Mobile network equipment

The Parties' and their main competitors' shares in relation to a possible market for mobile network equipment comprising both RAN  equipment  and
CNS solutions are illustrated in the below Table 11.

              Table 11: Market shares for all mobile network equipment (RAN and CNS) at worldwide and EEA level for 2014 by revenue

|                                  |Worldwide                         |EEA                               |
|Nokia                             |[10-20]%                          |[20-30]%                          |
|Alcatel                           |[10-20]%                          |[5-10]%                           |
|Combined                          |[20-30]%                          |[20-30]%                          |
|Ericsson                          |[30-40]%                          |[30-40]%                          |
|Huawei                            |[20-30]%                          |[20-30]%                          |
|ZTE                               |[5-10]%                           |[0-5]%                            |
|Samsung                           |[0-5]%                            |[0-5]%                            |

Source: Notifying Party's response to request for information no.4

As shown by the above table, both at worldwide and at EEA level the Parties' combined market shares would be close or above [20-30]%.

1 Notifying Party's view

The Notifying Party does not submit any specific arguments as regards  possible horizontal effects on  the  overall  market  for  mobile  network
equipment.

With regard to possible conglomerate effects, the Notifying Party submits that the merged entity will have a limited ability post-transaction  to
leverage the combined product portfolio and customer base of Nokia and Alcatel in mobile infrastructure equipment and  in  routing  equipment  in
order to start selling bundle of these products for the following reasons. First, purchasing decisions for IP  routing  equipment  are  generally
separate from those of RAN and CNS and follow different cycles depending on the growth  of  the  core  network  and  the  edge  traffic.  Second,
customers frequently mix and match RAN and/or CNS equipment from one vendor with IP routing from another vendor and if bundling  of  these  types
of equipment takes place it is usually initiated by the customers who may ask for better commercial and pricing terms for all products  purchased
from the same vendor based on the bigger volume of the contract.

2 Commission's assessment

The Commission considers that the Transaction will not give rise to horizontal unilateral effects at worldwide or EEA level.

First, the combined market shares are moderate both at worldwide level (combined market share: [20-30]%; Nokia  [10-20]%  and  Alcatel  [10-20]%)
and at EEA level (combined market share: [20-30]%; Nokia [20-30]% and Alcatel [5-10]%). At EEA level, the presumption set forth by  paragraph  18
of the Horizontal Merger Guidelines applies, as the merged entity's market share does not exceed 25%.

Second, both at worldwide and EEA level a sufficient number of mobile equipment vendors will remain active post-Transaction and will continue  to
exert significant competitive pressure on the merged entity: Ericsson, whose [30-40]% market share (both worldwide and  at  EEA  level)  will  be
higher than the one of the merged entity; Huawei ([20-30]% worldwide and [20-30]% at EEA level); as well as smaller competitors such as  ZTE  and
Samsung. In addition as established already above in Sections 5.2 and 5.3 the Parties are not close competitors neither in RAN equipment  nor  in
the provision of CNS solutions, therefore the Commission considers that Nokia and Alcatel are  not  close  competitors  as  regards  the  overall
possible market for mobile network equipment either, which mainly consists of RAN equipment and CNS solutions.

One respondent submits that the merged entity thanks to its broader product portfolio post-transaction and its  larger  customer  footprint  will
increasingly bundle mobile network infrastructure products with routing and switching solutions which would  result  in  increased  barriers  for
smaller vendors with narrower product portfolio to enter and compete in the relevant product markets.

The Commission considers that the Transaction will not give rise to conglomerate effects at worldwide or EEA level as there  are  no  indications
that any product bundling undertaken by the merged entity would result in anti-competitive effects.

First, the merged entity will not have a significant degree of market power in the market for mobile network  infrastructure  equipment,  nor  in
the (sub)markets for RAN equipment and CNS solutions, on the one hand, or in routing and switching solutions,[84] on the other hand. Indeed,  the
Commission has excluded that the merged entity will  acquire  any  significant  degree  of  market  power  in  the  markets  for  mobile  network
infrastructure equipment, RAN equipment and CNS solutions, respectively in this Section and in Sections 5.2 and 5.3 of this  Decision.  Moreover,
only Alcatel is active in routing and switching solutions and its market share, under any possible product and geographic  market  definition  is
never above [20-30]%. Other global providers of routing and switching solutions are Cisco (worldwide market share  of  [30-40]%  and  EEA  market
share of [40-50]%), Juniper (worldwide market share of [20-30]% and EEA market share of [20-30]%) and Huawei (worldwide market share of  [10-20]%
and EEA market share of [5-10]%).

Second, given the sufficient number of alternative providers for both mobile infrastructure equipment and for routing and switching products  the
respective products offered by Nokia and Alcatel do not seem to be of particular importance for customers who will still be able to  source  such
solutions from other providers.

Third, based on the available information, the purchasing patterns for mobile infrastructure equipment and for  routing  and  switching  products
seem to be different since typically RAN and/or CNS solutions are bought in separate tenders from routing and switching, despite  the  fact  that
some bundling may occur in the market on request of customers seeking better pricing in exchange for larger volumes of equipment  purchased.  The
Commission notes that even when such bundling of RAN and/or CNS products with  routing  and  switching  solutions  occurs,  it  could  have  pro-
competitive effects in the sense that customers could benefit from lower prices for sourcing RAN/CNS and routing and  switching  solutions  as  a
bundle from the same vendor.

Fourth, in view of the fact that at present Alcatel is already an active provider of RAN equipment and CNS solutions and its  respective  product
portfolio is the same as that of the merged entity, the combined entity would not have an increased ability to bundle  RAN  and/or  CNS  products
with routing and switching solutions post-Transaction compared to Alcatel's ability in this respect today.

Finally, the main competitors of the Parties today (Ericsson, Huawei and ZTE) are already able to  offer  RAN,  CNS  and  routing  and  switching
solutions to their customers and the Transaction would not place the merged entity in any position that is more favourable in  terms  of  ability
to bundle these types of equipment compared to the ability of existing  market  players.  Already  in  this  pre-Transaction  environment,  where
RAN/CNS provider are able to provide bundle with routing and  switching  solutions,  players  such  as  Juniper  and  Cisco  were  able  to  gain
significant market shares in the markets for routing and switching solutions, despite not being integrated in RAN and CNS.

In the light of the above the Commission considers that the Transaction does not raise serious doubts with regards to its compatibility with  the
internal market in the possible market for mobile network equipment.

5  Patents aggregation

Both Nokia and Alcatel hold an important number of patents: Nokia manages  a  total  portfolio  of  around  […]  patent  families,[85]  of  which
approximately […] are considered Standard Essential Patents ("SEPs") and Alcatel's SEPs encompass […] patent families.[86] In  this  Section  the
Commission assesses the effects of aggregation of Nokia's and Alcatel's patents.

1 Notifying Party's view

The Notifying Party claims that post-Transaction the  merged entity, as a result of its wider patent portfolio, will not have the ability  and/or
incentive to effectively engage in conduct which could result in the foreclosure of its competitors on the basis of Intellectual Property  Rights
("IPR").

The Notifying Party submits that all of Nokia's and Alcatel's SEPs have already been made available for licensing on fair,  reasonable  and  non-
discriminatory ("FRAND") terms and the Transaction will not affect in any way the Parties' FRAND commitments.

The Notifying Party further submits that the Transaction will not change Nokia's incentives in respect to patent licensing as Nokia  has  already
been active in the provision of the network infrastructure equipment and will continue to do so post-merger  becoming  a  bigger  player  with  a
larger product portfolio.

Finally the Notifying Party submits that all of the merged entity's major competitors will own a comparable or even larger number of  patents  in
the same business area.

2 Commission's assessment

The Commission considers that the Transaction does not raise serious doubts with regard to its compatibility with the internal market as  regards
patent aggregation for the following reasons.

First, to the extent that the patents that the merged entity will control are  SEPs,  such  patents  are  subject  to  FRAND  obligations.  FRAND
commitments essentially oblige SEP holders to make the patent in question available to all interested third parties, not to discriminate  between
different licensees and to offer a license on fair and reasonable terms. The merged entity is therefore  obliged  to  license  its  SEPs  to  any
interested party under such FRAND terms and the Transaction will not affect or change the Parties' FRAND commitments in this regard.

Second, the Commission notes that the merged entity's SEPs portfolio in relation to LTE network equipment (around […] SEPs or  approximately  [5-
10]% of all LTE SEPs declared to ETSI standardization body[87]) will be by and large of similar size as that of its  main  competitors  (Ericsson
with [5-10]% of LTE SEPs declared to ETSI, Huawei with [10-20]%, Samsung with [10-20]% and ZTE with [5-10]%). The merged entity's SEPs  portfolio
in relation to LTE network equipment will be related to a larger network equipment business downstream (compared to  today  businesses  of  Nokia
and Alcatel separately) and therefore the merged entity could not be considered a non-practicing entity as claimed by  a  market  player  in  the
market investigation.

Third, the majority of the competitors that took part in the Commission's market investigation in this case do not  expect  any  changes  of  the
licensing policy of Nokia and Alcatel as a result of the Transaction.[88]  Two  respondents  however  voiced  concerns  claiming  that  Nokia  is
currently an aggressive patent asserter and after the merger Nokia will extend this licensing  policy  to  the  Alcatel's  patents  portfolio  by
seeking to maximize the royalty payments for Alcatel's patents.

The Commission considers that these claims are not well-substantiated. As regards  the  SEPs  of  the  merged  entity  as  already  explained  in
paragraph (218) above such patents are under the obligation to be licensed on FRAND terms and these obligations will not change as  a  result  of
the Transaction. As regards non-SEPs, first the information gathered during the market investigation does  not  suggest  that,  post-Transaction,
Nokia would have greater ability and incentive to enforce Alcatel’s non-SEPs than Alcatel has today. Moreover, even if this were to be the  case,
the information in the Commission’s file does not provide indications that any Nokia/Alcatel non-SEP (whether on  a  standalone  basis  or  as  a
thicket) is indispensable for the merged entity’s competitors to compete on the market.

Therefore, the Commission concludes that no foreclosure effects are likely to arise in  relation  to  SEPs  and  non-SEPs  as  a  result  of  the
Transaction.

In the light of the above the Commission considers that the Transaction does not raise serious doubts with regards to its compatibility with  the
internal market with respect to patents aggregations.

CONCLUSION

For the above reasons, the European Commission has decided not to oppose the notified operation and to declare it compatible  with  the  internal
market and with the EEA Agreement. This decision is adopted in application of Article 6(1)(b) of the Merger Regulation and Article 57 of the  EEA
Agreement.

For the Commission
(Signed)
Margrethe VESTAGER
Member of the Commission

-----------------------
[1]   OJ L 24, 29.1.2004, p. 1 ('the Merger Regulation'). With effect from 1 December 2009, the Treaty on the Functioning of the  European  Union
('TFEU') has introduced certain changes, such as the replacement of 'Community'  by  'Union'  and  'common  market'  by  'internal  market'.  The
terminology of the TFEU will be used throughout this decision.

[2]   OJ L 1, 3.1.1994, p.3 ("the EEA Agreement").

[3]   Only one Alcatel's shareholder currently owns more than 5% of shares or voting rights.

[4]   Pursuant to the Memorandum of Understanding, in the event that Nokia owns less than 95% of Alcatel at  post-Transaction,  it  reserves  its
rights to take other steps necessary to reach 100% ownership of Alcatel.

[5]   See page 2, Total coverage by technology at EU level 2012-2013 (HSPA indicator – HSPA is a technology  built  onto  existing  3G  UMTS  and
WCDMA technologies to  provide  increased  data  transfer  speeds)  in  Digital  Agenda  Scoreboard  2014  "Broadband  markets"  presentation  at
http://ec.europa.eu/information_society/newsroom/cf/dae/document.cfm?doc_id=5810

[6]   WCDMA and UTMS are the same technology and both acronyms are used interchangeably, particularly in reference to RAN.

[7]   Neither Nokia nor Alcatel offer WiMAX products.

[8]   Commission decision in Case M.4297 – NOKIA/ SIEMENS of 13 November 2006.

[9]   Commission decision in Case M.6007 Nokia Siemens Networks/Motorola Network Business of 15 December 2010.

[10]        Commission decision in Case M.4297 – NOKIA/ SIEMENS of 13 November 2006, paragraph 19.

[11]  Commission decision in Case M.4297 – NOKIA/ SIEMENS of 13 November 2006, paragraphs 26 -29.

[12]  Commission decision in Case M.6007 Nokia Siemens Networks/Motorola Network Business of 15 December paragraphs 13 and 14.

[13]  See replies to Q2 - questionnaire to customers, questions 2 and 3.

[14]  See replies to Q1 – questionnaire to competitors, question 3.

[15]  See replies to Q2 - questionnaire to customers, question 4.

[16]  See replies to Q1 – questionnaire to competitors, question 5.

[17]  See replies to Q2 - questionnaire to customers, question 5.

[18]  Commission decision in Case M.4297 – NOKIA/ SIEMENS of 13 November 2006, paragraph 48.

[19]  Commission decision in Case M.6007 Nokia Siemens Networks/Motorola Network Business of 15 December 2010, paragraph 21.

[20]  See replies to Q2 - questionnaire to customers, question 6.

[21]  See replies to Q2 - questionnaire to customers, question 6.

[22]  See replies to Q2 - questionnaire to customers, question 6.

[23]  See replies to Q1 - questionnaire to competitors, question 8 and 9.

[24]  See replies to Q1- questionnaire to competitors, question 10.

[25]  See replies to Q1- questionnaire to competitors, question 12.

[26]  See replies to Q1- questionnaire to competitors, question 14.

[27]  Thanks to the full interoperability between RAN and CNS equipment, operators can choose to source RAN  and  CNS  equipment  from  different
vendors. The full interoperability is ensured by the standardisation of the interfaces that handle the communication  between  the  RAN  and  the
CNS.

[28]  The Traditional Packet Core uses circuit-switching equipment for voice traffic and packet-switching equipment for data traffic,  while  the
Evolved Packet Core treats voice and data traffic as IP traffic.

[29]  Neither Nokia nor Alcatel offer PDSN or ASN Gateway products.

[30]  Such sub-component include  Gateway GPRS Support Node ("GGSN"), Serving GPRS Support Node ("SGSN"), Packet Data Serving Node  ("PDSN")  and
Access Service Network ("ASN") Gateway for the Traditional Packet Core and Mobility Management Entity  ("MME")  plus  Packet  Data  Node  gateway
("PGW") for the Evolved Packet Core.

[31]  Carrier IP telephony components include: Softswitch (both wireless and wireline), Media  Gateway  (both  wireless  and  wireline),  Session
Border Controller, Voice Application Server (both wireless and wireline), IP Multimedia Subsystem ("IMS") core covering IMS Call Session  Control
Function ("IMS CSCF") and IMS Home Subscriber Server ("IMS HSS") sub-components.

[32]  Commission decision in Case M.4297 – NOKIA/ SIEMENS of 13 November 2006, paragraphs 19 and 23.

[33]  Commission decision in Case M.4297 – NOKIA/ SIEMENS of 13 November 2006, paragraphs  29  and  Commission  decision  in  Case  M.6007  Nokia
Siemens Networks/Motorola Network Business of 15 December 2010, paragraph 14.

[34]  Commission decision in Case M.4297 – NOKIA/ SIEMENS of 13 November 2006, paragraph 29.

[35]  The market investigation in Nokia/Siemens revealed that BSS and OSS are different in terms of interchangeability.

[36]  See replies to Q2 - questionnaire to customers, question 18 and replies to Q1 – questionnaire to competitors, question 26.

[37]  See replies to Q2 - questionnaire to customers, question 19.

[38]  See replies to Q2 - questionnaire to customers, question 20.

[39]  See replies to Q1 – questionnaire to competitors, questions 27 and 28.

[40]  See replies to Q2 - questionnaire to customers, question 21 and replies to Q1 – questionnaire to competitors, question 29.

[41]  See replies to Q2 - questionnaire to customers, questions 22 and 23.

[42]  See replies to Q1 – questionnaire to competitors, questions 30 and 31.

[43]  See replies to Q1 – questionnaire to competitors, question 32.

[44]  See replies to Q2 - questionnaire to customers, question 32;  replies  to  Q1  –  questionnaire  to  competitors,  question  50  and  Q3  –
questionnaire to C-SON competitors, question 3.

[45]  See replies to Q2 - questionnaire to customers, question 33.

[46]  Commission decision in Case M.4297 – NOKIA/ SIEMENS of 13 November 2006, paragraphs 47, 51 and  54.

[47]  Commission decision in Case M.6007 Nokia Siemens Networks/Motorola Network Business of 15 December 2010, paragraphs 20 and 21.

[48]  With respect to Carrier IP telephony a respondent explains that IP is a worldwide standardized technology and therefore there could  be  no
differences on the provided technology around the globe, see replies to Q2 - questionnaire to customers, question 26.

[49]  See replies to Q2 - questionnaire to customers, questions 25 and 26.

[50]  See replies to Q1 – questionnaire to competitors, questions 33 and 39.

[51]  See replies to Q1 – questionnaire to competitors, questions 34 and 40.

[52]  See replies to Q1 – questionnaire to competitors, questions 35 and 41.

[53]  Managed services allow an operator to outsource certain  tasks  to  the  service  provider.  Managed  service  may  include  (i)  technical
management of parts of the network; (ii) hosting services and (iii) Build-Operate-Transfer, which includes the construction of a network  for  an
operator, followed by a period of network operation by the service provider, and finally an optional handover to the operator.

[54]            Parties estimate their market share in HSS to correspond to their overall IMS Core market share.

[55]  See replies to Q2 – questionnaire to customers, question 8.

[56]  See replies to Q2 – questionnaire to customers, question 12.

[57]  See replies to Q2 – questionnaire to customers, question 11.

[58]  Nokia's internal presentations "Competitive Landscape Q2/14" dated 26 August 2014 and "Competitive landscape Q1/14" dated 23 May 2014.

[59]  Guidelines on the assessment of horizontal mergers under the Council Regulation on  the  control  of  concentrations  between  undertakings
("Horizontal Merger Guidelines"), Official Journal C 31, 05.02.2004, p. 5-18, paragraph 45.

[60]  Horizontal Merger Guidelines, paragraph 42.

[61]  Horizontal Merger Guidelines, paragraph 43.

[62]  Horizontal Merger Guidelines, paragraph 49.

[63]  Horizontal Merger Guidelines, paragraphs 52-53.

[64]  See replies to Q2 – questionnaire to customers, question 13.

[65]  See replies to Q2 – questionnaire to customers, question 11.

[66]  See replies to Q2 – questionnaire to customers, question 17.

[67]  See replies to Q2 – questionnaire to customers, question 13.

[68]  See replies replies to Q2 – questionnaire to customers, question 12.

[69]  Alcatel's Press release: Alcatel-Lucent launches "The Shift Plan" to focus on IP networking  and  ultra-broadband  access  (19  June  2013)
https://www.alcatel-lucent.com/press/2013/002859.

[70]  2G CDMA and 2/2.5G GSM/GPRS/EDGE constitute different technologies. In particular, 2/2.5G GSM/GPRS/EDGE is based  on  completely  different
basic technology than 2G CDMA and therefore these two technologies are not interoperable, i.e. there are always separated GSM and  CDMA  networks
even if the two technologies are deployed in the same country.

[71]  2G (CDMA) equipment is primarily used in geographies, such as North America, China, Japan and South Korea.

[72]  Software Defined Networking is a new approach to designing, building, and managing networks, that separates the network’s control  (brains)
and forwarding (muscle) planes to better optimize each.

[73]  See replies to Q2 - questionnaire to customers, question 28 and replies to Q1 – questionnaire to competitors, question 46.

[74]  Ibid.

[75]  See replies to Q2 - questionnaire to customers, question 30 and replies to Q1 – questionnaire to competitors, question 48.

[76]  See replies to Q2 - questionnaire to customers, question 30 and replies to Q1 – questionnaire to competitors, question 48.

[77]  The market shares estimated by Dell'Oro for the CSCF component likely misrepresent the actual market shares, as  Dell'Oro  methodology  for
calculating these shares consists of estimating the total market for CSCF by removing the total market size for HSS (USD 562.9 million) from  the
total market size of the IMS Core market (USD 1 732.6 million), obtaining in this way a total CSCF market of USD 1 169.7  million.  By  contrast,
market shares of vendors on the CSCF market are calculated on the basis of their total IMS Core sales without deducting their HSS sales.

[78]  Nokia has recently acquired in 2015 US Eden Rock which offers a multivendor C-SON solution.

[79]  http://www.zte.com.cn/cn/banner/doc/201503/t20150324_432494.html

[80]  https://www.alcatel-lucent.com/osscp

[81]  See replies to Q2 - questionnaire to customers, question 37.

[82]  Guidelines on the assessment of non-horizontal mergers under the Council regulation on the control of concentrations  between  undertakings
("Non-Horizontal Merger Guidelines"), OJ C 265, 18 October 2008, paragraph 35.

[83]  The Notifying Party claims that using real-time/near real-time interfaces information for traffic steering purposes as part  of  the  C-SON
solution operation could overload the network management system, adversely affecting the network performance. […].  These  technical  limitations
to the scope of the interfaces information licensed under OSSii were according to Nokia incorporated in the interest  of  avoiding  the  risk  of
network performance degradation.

[84]  IP routing equipment referenced covers only so-called Service Provider or SP routers purchased by telecommunication networks providers  and
excludes smaller, less powerful routers called Enterprise Routers which are not purchased by mobile network equipment customers.

[85]  Nokia's patents are held and managed by three different business units: Nokia Networks with a portfolio  of  near  4  000  patent  families
which include 11 000 granted patents and patent applications (of which around […] are SEPs), Nokia Technologies with approximately 10 000  patent
families including 30 000 granted patents and patent applications (of which 1 200 are SEPs) and HERE managing a portfolio of around  700  digital
mapping related patent families. Nokia's patent families cover a broad range of domains and technologies: radio […]; networks and  services  […];
multimedia […]; software […]; hardware […]; maps and location […]; User Interface […].

[86]  Alcatel-Lucent's patent portfolio consists of approximately 33 000 granted patents and 15 000 pending applications of April 2015.

[87]  European Telecommunications Standards Institute

[88]  See replies to Q1 - questionnaire to competitors, question 56.

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                                                                 MERGER PROCEDURE

                                                                  PUBLIC VERSION