Nokia 2008 Annual Report Download - page 23

Our sales and results of operations could be materially adversely affected if we fail to
efficiently manage our manufacturing and logistics without interruption or make timely and
appropriate adjustments, or fail to ensure that our products, services and solutions meet our
and our customers’ quality, safety, security and other requirements and are delivered on time
and in sufficient volumes.
Our manufacturing and logistics are complex, require advanced and costly equipment and include
outsourcing to third parties. These operations are continuously modified in an effort to improve
efficiency and flexibility of our manufacturing and logistics and to produce and distribute
continuously increased volumes. We may experience difficulties in adapting our supply to meet the
changing demand for our products, including planning our manufacturing and logistics in the current
difficult global economic environment, both ramping up and down production at our facilities as
needed on a timely basis, maintaining an optimal inventory level, adopting new manufacturing
processes, finding the most timely way to develop the best technical solutions for new products,
managing the increasingly complex manufacturing process for our highend products, particularly the
software for these highend products, or achieving manufacturing efficiency and flexibility, whether
we manufacture our products and solutions ourselves or outsource to third parties. We may also
experience challenges caused by third parties or other external difficulties in connection with our
efforts to modify our operations to improve the efficiency and flexibility of our manufacturing and
logistics, including, but not limited to, strikes, purchasing boycotts, public harm to the Nokia brand
and claims for compensation resulting from our decisions on where to locate our manufacturing
facilities and business. Such difficulties may have a material adverse effect on our business and
results of operations and may result from, among other things, delays in adjusting or upgrading
production at our facilities, delays in expanding production capacity, failure in our manufacturing and
logistics processes, failures in the activities we have outsourced, and interruptions in the data
communication systems that run our operations. Such failures or interruptions could result in our
products, services and solutions not meeting our and our customers’ quality, safety, security and
other requirements, or being delivered late or in insufficient or excess volumes compared to our own
estimates or customer requirements, which could have a material adverse effect on our sales, our
results of operations, reputation and the value of the Nokia brand.
Our products, services and solutions include increasingly complex technologies, some of which
have been developed by us or licensed to us by certain third parties. As a consequence,
evaluating the rights related to the technologies we use or intend to use is more and more
challenging, and we expect increasingly to face claims that we have infringed third parties’
intellectual property rights. The use of these technologies may also result in increased
licensing costs for us, restrictions on our ability to use certain technologies in our products,
services and solution offerings, and/or costly and timeconsuming litigation, which could have
a material adverse effect on our business, results of operations and financial condition.
Our products, services and solutions include increasingly complex technologies, some of which have
been developed by us or licensed to us by third parties. As the amount of such proprietary
technologies and the number of parties claiming intellectual property rights continues to increase,
even within individual products, as the range of our products, services and solutions becomes more
diversified and we enter new businesses, and as the complexity of the technology increases, the
possibility of alleged infringement and related intellectual property claims against us continues to
rise. The holders of patents and other intellectual property rights potentially relevant to our products
and solutions may be unknown to us, may have different business models, or may otherwise make it
difficult for us to acquire a license on commercially acceptable terms. There may also be technologies
licensed to and relied on by us that are subject to infringement or other corresponding allegations or
claims by others which could impair our ability to rely on such technologies. In addition, although we
endeavor to ensure that companies that work with us possess appropriate intellectual property rights
or licenses, we cannot fully avoid risks of intellectual property rights infringement created by
suppliers of components and various layers in our products, services and solutions or by companies
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