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Nokia cuts 50 jobs, focuses abroad

The cell phone giant confirms it is laying off 50 engineers in Texas as its concentrates its research and development efforts in the United Kingdom and India.

Cell phone giant Nokia on Thursday confirmed that it has laid off 50 engineers in Texas in an effort to "centralize" its research and development department in the United Kingdom and India.

The layoffs are part of a plan to reduce costs, Nokia spokeswoman Laurie Armstrong said. She declined to comment on whether the handset maker would add jobs in Nokia's existing U.K. and India offices.

"We decided to concentrate some of our efforts into fewer sites," Armstrong said.

The job cuts at Nokia's research and development operations in Irving, Texas, come amidst growing concern in the United States about white-collar employees being replaced by cheaper outsourced labor abroad. Market research firm IDC recently estimated that by 2007, 23 percent of all information technology services jobs will be moved offshore, up from 5 percent in 2003. The figures refer to IT work done for U.S.-based companies.

Many technology companies, including Hewlett-Packard, Siebel Systems, America Online and Yahoo have opened or plan to open offices in outsourcing hotbeds such as India, the Philippines, China and Ireland.

Nokia's Armstrong said research and development will continue to play a "vital" role in the Finnish company's competitive strategy. She said the cuts in Texas affect a "small percentage" of the cell phone maker's overall R&D work force.

CNET News.com's Ed Frauenheim contributed to this report.