InterDigital Inc (IDCC)

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(COMTEX) B: Sony Ericsson Cuts 100 Jobs from Research Triangle Park, N.C.

RESEARCH TRIANGLE PARK, N.C., Mar 22, 2003 (The News & Observer - Knight
Ridder/Tribune Business News via COMTEX) -- Sony Ericsson cut 100 jobs at the
company's North American headquarters in Research Triangle Park this week as the
world's fifth-largest mobile-phone maker struggles to trim costs and post a
profit.

The reductions, about 14 percent of its local jobs, came Thursday across an
array of divisions and leave 640 workers in RTP, said Urban Gillstrom, president
of Sony Ericsson's U.S. operations.

Sony Ericsson, a venture formed in 2001 by the merger of Sony and Ericsson's
mobile-phone businesses, made the cuts and curbed other spending after it failed
to make money last year and ceded market share to rivals such as Nokia. The
company is striving to post its first profit this year by introducing new phones
with color screens, cameras and other features.

"Restructuring is going on right now," Gillstrom said. "It's based on the
underdevelopment of the business globally."

Other cuts were made in North America, but the majority came in RTP. The
London-based company now has about 720 workers in North America, down from 840,
and about 4,000 worldwide, said Al Ragland, vice president of human resources in
RTP.

Displaced workers in RTP, where employees primarily work in research,
development and administration, were offered severance based on service, and job
search assistance, Ragland said.

Sony Ericsson has had four quarterly losses amid waning demand for its products.
The venture now controls about 6.2 percent of the worldwide handset market,
lagging Nokia, Motorola, Samsung and Siemens. That's down from about 10 percent
when the combination was announced.

The company says it needs 7 percent to 10 percent of the market to show a profit
and is working toward that goal this year.

But analysts say that target will be tough to achieve.

"In this competitive environment, we think that will be challenging," said Peter
Friedland, an analyst with WR Hambrecht & Co. in San Francisco.

And failure to make money this year could prompt Sony and Ericsson to rethink
the venture, said James E. Faucette, who follows Ericsson for Pacific Crest
Securities in Portland.

Ericsson, the world's largest maker of mobile-phone networks, has been
struggling with its own business. It posted its seventh-straight quarterly loss
last month and predicted demand will fall for a third year. The Swedish company,
which employs about 250 in RTP, has pared its work force by 40,000 jobs
worldwide since 2001.

Gillstrom was recently named as president of Sony Ericsson's U.S. operations,
replacing Sandeep Chennakeshu, who left to become president of Ericsson's Mobile
Platforms division.

Gillstrom has been in RTP since the beginning of the year and will continue to
oversee North American sales and marketing. Chennakeshu will continue to work
closely with the venture in his new role, said Sony Ericsson spokeswoman Merran
Wrigley.

"In reality, there's not that much change to top management," Wrigley said,
adding that Sony Ericsson is "very firmly committed" to its U.S. operations.

By Jonathan B. Cox
To see more of The News & Observer, or to subscribe to the newspaper, go to
http://www.newsobserver.com.

(c) 2003, The News & Observer, Raleigh, N.C. Distributed by Knight
Ridder/Tribune Business News.

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