Siemens' handset business has been suffering for quite sometime, despite some innovative models that the company has launched over the past year (including the SK65, which was reported here last year). Rumors have been everywhere, including a report that appeared this weekend on the Sueddeutsche Zeitung.  In that particular report, Taiwanese electronics powerhouse Acer was linked with being a potential investor in the German vendor's mobile phone unit.  Motorola has also been linked as a potential candidate in other articles.  In the meantime, losses the that cell phone unit have reached 100 million € (roughly US$ 130 million), and despite all these sales or partnership rumors, the exiting administration has given no guidance on the direction the company will take to find a solution.  The appreciation of the euro versus the dollar is further exacerbating the problem, and the company believes the € will rise over $1.35 this year.

Siemens shareholders expect incoming CEO (Peter Kleinfeld) will find a solution (i.e. spin off, seek a partner or even close the operation).  But Acer is denying the newspaper report, and the Motorola partnership does not seem a very likely scenario anymore, given that the US vendor has already made good progress into the European continent, so teaming up with Siemens would not be as advantageous (the Motorola story has been floated around for the past couple of years, before the Euro progress made by Motorola).  I had an "Eureka" moment thinking about this issue and thought of a more interesting partner that has not been mentioned too much... LG Electronics.  This could potentially create a Sony-Ericsson type entity, which can pickup strong shares in markets such as Asia/Pacific, Europe and the Americas.