Struggling telecom equipment maker Nokia Siemens Networks aims to cut up to 5,800 jobs and save more than €1 billion to stay competitive in the market.
The company will revamp its operations hoping to benefit from its stronger position in offering services to operators.
Telecom gear makers have been hit hard by the recession, which crimped operator spending, and by tough competition from China's Huawei and ZTE.
Last month market leader Ericsson reported third-quarter earnings below expectations and declined to forecast an upturn.
NSN, a joint venture of Nokia and Siemens, said it aimed to cut €500 million in annual fixed costs by the end of 2011, putting up to 5,800 of the firm's 64,000 staff at risk.
Workers in Germany and Finland protested against the plan. "Shrinking more than the market is no honour for the top management," said Georg Nassauer, the head of works council of Nokia Siemens in Munich.
"With this kind of restructuring we are not gaining any customer or order. It takes the power out of the company," he said in a statement.
Nokia Siemens said the programme, something analysts have expected given the persistently tough market conditions, could bring total charges of some €550 million in 2010-11.
Reuters