Nokia Siemens Networks:

Lawful Intercept Capability for Iran

This case was written by Judith Schrempf, PhD Candidate in Corporate Social Responsibility,
HEC University of Lausanne under the supervision of Prof Guido Palazzo. It is intended to be
used as the basis for class discussion rather than to illustrate either effective or ineffective
handling of a management situation. The case was compiled from published sources.

©, 2010, The Institute of International Management of University of Lausanne.

No part of this publication may be copied, stored, transmitted, reproduced or distributed in
any form or medium whatsoever without permission of the copyright owner.

1
Graduate School of Business (HEC, Ecole des Hautes Etudes Commerciales)

University of Lausanne (Switzerland)

Nokia Siemens Networks: Lawful Intercept Capability for Iran

Judith Schrempf prepared this case solely to provide material for class discussion. The author
does not intend to illustrate either effective or ineffective handling of a business situation.

The Institute of International Management of the University of Lausanne (IRM) prohibits any
form of reproduction, storage or transmittal without written permission. To request permission
to reproduce materials, contact IRM, HEC, Internef, CH-1015 Lausanne Dorigny,
Switzerland; phone: 0041 21 692 3304; fax: 0041 21 692 3495; e-mail:
isabelle.sutherland@unil.ch.

© IRM/ HEC, 2010

October 1, 2009, Nokia Siemens Networks headquarters in Espoo, Finland

On his first day as the CEO of Nokia Siemens Networks (NSN), Rajeev Suri skimmed

through the dossier which his PR manager gave him. The dossier summarised the civil society

reaction to the company’s business deal with the Iranian government. After the 2009

presidential election in Iran, the media reported on NSN’s business relations with Iran in

summer 2009. Besides statements like “Neda’s blood sticks on Nokia products” or “Nokia

Siemens Networks is a handyman of dictatorship”, the dossier includes collages and NSN’s

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reaction to the media reports (see Appendix). While scanning through the dossier, Suri recalls

the appealing business deal and the civil society outrage that followed.

Nokia Siemens Networks (NSN)

The 50:50 joint venture of mobile manufacturer Nokia and energy/ electrical giant

Siemens started operating in April 2007. Nokia is a world leader in mobile communications.

The corporation’s product portfolio includes mobile phones, devices and solutions for

imaging, games, media and business. It equally offers equipment, solutions and services for

network operators and companies1. Siemens offers products in information and

communications, automation and control, power, transportation, medical devices, and

lighting. The German company is a global powerhouse in electrical engineering and

electronics2. NSN combines Nokia’s networks business group and the carrier related business

of Siemens Communications. Siemens retains only a non-controlling financial interest while

Nokia deals with the day-to-day business operations.

NSN is one of the world’s biggest telecommunications infrastructure companies with

headquarters in Espoo, Finland. Net sales of Nokia Siemens Networks totalled 15.3 million

Euros in 2008.3 Over 1.5 billion people connect through NSN’s networks. NSN constitutes

the No 2 in wireless networks and operator services. NSN operates in more than 150 countries

with around 60,000 employees serving 600 customers. NSN customers include

Communications Service Providers (CSPs), governments and businesses. CSPs are public or

private corporations which transport information electronically like wireless

telecommunication operators and Internet service providers. Prominent examples are Orange,

T-Mobile or Vodafone. NSN provides CSPs with the technology and infrastructure like

1
http://www.nokia.com
2
http://www.siemens.com
3
http://www.nokiasiemensnetworks.com
3
microwave antennas, repeater stations and satellite links which enable data transportation and

communication. In a nutshell, NSN provides the infrastructure to make Internet and other

mobile communications possible.

NSN disposes of a comprehensive service and product portfolio. NSN offers a product

portfolio of mobile, fixed and converged network infrastructure solutions. NSN offers

hardware and software components for vocal, data and mobile network communications. It

provides for instance CSPs with the infrastructure to enable wireless and mobile

telecommunication transfer. Its software solutions encompass products which manage,

analyse and inspect voice, data and mobile communications and traffic. Those software

packages allow service operators to control, observe and manage data flow and improve

network efficiency. They can also be used for web censorship, Internet filtering and data

inspection. Since the internet can constitute a crime channel (child pornography, terrorism)

legal regulations and standards exist which allow “lawful interception”. Software solutions

such as controlling devices can be used to prohibit child pornography, to locate terrorists and

to fight corruption and money laundering. Several standard bodies such as the European

Telecommunications Standards Institute (ETSI)4, the 3rd Generation Partnership Project5 and

the Communications Assistance for Law Enforcement Act (CALEA)6 provide the basis for

lawful interception. In the European Union lawful interception implementation is required

which forces corporations such as NSN to provide this technology to network operators when

selling their network products and services. NSN sells such lawful interception software under

the name “monitoring centre”. NSN’s monitoring centres can enable internet service

providers to conduct voice but also data monitoring depending on the system setup.

4
http://www.etsi.org
5
http://www.3gpp.org
6
http://www.askcalea.net
4
 The telecommunications market is marked by two characteristics: First, there is a

promising market potential for mobile and internet communications. Key drivers of this

growth are emerging markets, broadband internet and growth in mobile networks7. The

demand for sophisticated network penetration is not only high in Western countries, but also

in emerging countries. Latin America, India and Iran possess special growth potential as those

countries want to increase their wireless and mobile connectivity8. Second, during the last

years the competition in the telecommunications sector has increased due to the rapid changes

in technology. Amongst NSN major competitors are Alcatel-Lucent, Ericsson, Cisco Systems

and Huawei. Competition is especially severe from Chinese vendors like Huawei9. Asian and

Chinese vendors enjoy funding from the government and can therefore offer their products

and services at lower prices compared to the industry average. Due to the fierce price

competition, each corporation is eager to get a business deal considering the fierce market

competition. This was the case for NSN when it closed its deal with the Iranian government to

enlarge the country’s mobile network.

Nokia Siemens Networks and the Iranian government

Since NSN’s foundation, the company has had frequent business relations with many

governments including Iran. Iran wants to expand its wireless and mobile networks and

approached NSN to provide the necessary gear, infrastructure components and upgrades. In

the course of the business deal, NSN provided the Iranian operator TCI with lawful intercept

software which enables the company to monitor conversations on mobile and fixed phones in

2008. The monitoring centre which NSN sold to TCI enables the operator to conduct voice

monitoring of national phone calls. Telecommunication suppliers are legally obliged to

7
Business Insights Ltd. (2008b)
8
Business Insights Ltd. (2008b);
9
Business Insights Ltd (2008)
5
provide CSPs with lawful intercept capability. Those legal regulations do not only exist in

Iran, but in most Western countries. Besides, such requirements can be found in

internationally recognised standards such as ETSI and CALEA. Hence, such controlling and

monitoring devices are standard components when selling network equipment. The provision

of lawful intercept capability to the state controlled operator TCI gained publicity in summer

2009 after the controversial Iranian presidential elections. The technology is claimed to

support the country’s censorship and communication control.

Iran: political regime

In 1979, the Iranian Revolution ended the monarchy under Shah Mohammad Reza

Pahlavi who had long been criticised for his pro-Western policies and relations to the United

States by the Iranian clergy. The conservative spiritual leader Ayatollah Ruhollah Khomeini

led the revolution, announced the Islamic Republic of Iran and became its Supreme Leader.

The Supreme Leader has the highest political and religious authority in the country and

therefore has the most powerful position in Iran. The Supreme Leader assigns powerful

political and judicial positions such as the military commanders, national Security Council

members, the Chief Judge and half of the members of the Guardian Council which has

legislative as well as executive power. The Guardian Council approves laws but also the

candidates for presidential elections. Even though the President of Iran is the highest publicly

elected political official, he is subordinated to the Supreme Leader. The president’s

responsibility is the implementation of the constitution. As the head of the executive branch,

the president is, for example, in charge of signing treaties, budget planning and national

employment affairs. However, he does not dispose of the complete control over foreign

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policy, the military and some other policies10. The Supreme Leader is the final decision maker

in areas of security, defence and foreign policy11.

The post-revolution era was marked by international tensions12, conflicts (Iran-Iraq

war)13 and anti-Western (American) policies14. After Khomeini’s death in 1989, the cleric Ali

Hoseini Khamenei became his successor and is presently Iran’s Supreme Leader. He

continued Khomeini’s opposition to the West (and the United States in particular). After a

conservative presidency for nearly twenty years, reformist Mohammad Khatami became

Iran’s president in 1997. During his governance, Khatami tended to support freedom of

expression, tolerance and civil society, which led to tensions between his government and the

conservative clergy resulting in anti-government protests. For the 2005 presidential elections,

many reformist candidates were banned and the conservative hard-line candidate Mahmoud

Ahmadinejad won the election.

Despite the reformist interlude, Iranian policy has been mainly dominated by the

clergy and conservatives. The power of the Supreme Leader is undeniable. The U.S. based

Committee to Protect Journalists refers to Khamenei as one of the “ten worst enemies of the

press and freedom of expression”15. Khameini is considered as the driving force behind the

creation of media censorship and control in Iran.

Iran’s media censorship and control

Censorship has a long tradition in Iran. It is anchored in Iran’s constitution and the

1989 Press Law and its amendments. According to the country’s constitution, publications

10
BBC News (n.a.)
11
Amnesty International (2009)
12
BBC News: http://news.bbc.co.uk/onthisday/hi/dates/stories/november/4/newsid_3910000/3910627.stm
13
BBC News: http://news.bbc.co.uk/2/hi/4260420.stm
14
CBC News (2009)
15
Committee to Protect Journalists (2000).
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must not “violate Islamic principles or the civil code”16. The 1986 Press Law provides further

publication guidelines. The press must “advance the objectives of Iran, counteract internal

division among citizens, propagate Islamic culture and principles, and reject manifestations or

imperialistic culture as well as foreign politics and economic politics”17. Publishers need to

acquire a license from the Ministry of Islamic Culture and Guidance. The control of

publications goes as far as the regulation of publication names and publishing timetables. The

overarching mantra is that publications need to be in the best interest of the community and

never “violate Islamic principles and codes and public rights”18. Media content is observed by

the Supreme National Security Council. Regulatory restrictions apply to topics such as

religion, morals, national security, politics and anti-revolutionary activity. The council

provides publishers with a list of banned subjects19. Even though there are still some

independent newspapers, the number is low and continues to decrease. Many newspapers

apply self-censorship in order to avoid sanctions. Any violations are addressed to a special

press court. The Iranian government aims at controlling TV communications as well. Satellite

dishes for instance are officially forbidden. The government blocks foreign based TV stations

frequently as in 2003 when U.S. television channels were blocked20. The Press Law initially

applied to print media, radio transmissions and television broadcasting. With the increased

usage and importance of Internet communication, Iran’s censorship has gradually expanded to

this media format as well.

Internet censorship

16
Mackey (2009)
17
OpenNet Initiative (2005): 8
18
OpenNet Initiative (2005): 9
19
Feuilherade (2002); Reporters Sans Frontières (2004)
20
Carter (2003)
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 The Middle East and Iran in particular have experienced a tremendous increase in

Internet usage and popularity. In 2001, Iran had around 1 million Internet users. Today, it

disposes of over 30 million Internet users which represent nearly half of its population21. The

annual growth rate of Internet users lies at approximately 48 percent22. Iran’s capital, Tehran

alone has nearly 2,000 cybercafés. As the tremendous increase in Internet usage shows, the

Internet has become an important information resource and communication platform for

Iran’s population. The Internet is the most trusted media platform. Blogs are frequently used

and are growing tremendously in both numbers and trust. At the beginning of Internet

availability in Iran, it was a rather uncontrolled communication medium. This enabled

uncensored publications of independent publishers and opposing viewpoints to be spread.

Iranian expatriates for example used the Internet to publish their views on the Iranian

government and its politics. The growing popularity of the Internet did, however, not remain

unnoticed by the Iranian government. Since 2001, the government targets online dissenting

voices, bloggers and online media outlets. The government’s Internet censorship spans from

the establishment of new government agencies and regulations to technical control

mechanisms and punishment, including imprisonment and torture23.

All commercial Internet Service Providers (ISP) are required to connect via the state-

controlled Telecommunication Company of Iran (TCI). Hence, the complete Internet traffic is

centralised. All traffic runs through a government-managed gateway. This centralisation

facilitates the censorship but also the control. In general, all ISPs need to be approved by TCI

and the Ministry of Culture and Islamic Guidance. In 2001, TCI set the guideline that all ISPs

have to filter all materials which might be immoral or threaten state security. This also

21
http://www.internetworldstats.com/me/ir.htm
22
OpenNet Initiative (2009)
23
Human Rights Watch (2005)
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includes the filtering of Web pages of opposition groups24. Since 2001, Internet providers

must install filtering software25. The main targets of filtering are Iran-related (and critical)

Web sites, especially in local languages (Persian and Farsi). The filtering software covers both

Web sites and e-mails. All in all, politically sensitive sites (including blogs) as well as sites

which include gay and lesbian content or information about women’s rights are blocked. Iran

disposes of one of the “most sophisticated state-mandated filtering systems”26. Initially, Iran

relied on the commercial software SmartFilter – an American product. SmartFilter blocks

internationally-hosted web pages in English but also web pages in local languages. Iran-based

Web pages might be shut down, suspended, or filtered. During the last years, Iran has aimed

to become independent from Western technology to filter web content. Using Western

technologies constitutes a weakness and even a potential vulnerability to the Iranian Internet.

Hence, various Iranian technology corporations started developing filtering software27. Iranian

technology enables the government to search the Internet for specific keywords and

questionable content. “With the emergence of this domestic technical capacity, Iran joins

China as the only countries that aggressively filter the Internet using their own technology”28.

Besides the sophisticated filtering mechanisms, the government established a blacklist which

is composed of sites which are blocked due to their content29. During the last years, five

million Web pages have been blocked30.

To administer the regulations and censorship, the Iranian government has established

various new governmental agencies. The Supreme Council of the Cultural Revolution

(SCRC) passed down the filtering system decrees in 2001. The Committee in Charge of

24
OpenNet Initiative (2005)
25
Proschofsky (2009)
26
OpenNet Initiative (2005): 3
27
Rooz (2008)
28
OpenNet Initiative (2009): 4
29
BBC News (2003)
30
Proschofsky (2009)
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Determining Unauthorized Sites (CCDUS) outlines criteria to identify unauthorized Web

pages and blocks them where appropriate. The Information Technology Company of Iran

(ITC) is responsible for filtering decisions. Finally, the Communication Infrastructure

Company unifies filtering policies across the country31.

Governmental censorship for all forms of media (online and offline) especially

increased previous to the 2004 parliamentary elections. Reformist newspapers were closed,

journalists were arrested and several Internet Web pages (including pro-reformist sites) were

blocked. With the election of President Mahmoud Ahmadinejad, the censorship has increased

considerably. Reporters Without Frontiers (RSF) label Iran as “an enemy of the internet”32

and the OpenNet Initiative calls Iran’s internet censorship policies “pervasive”33. In 2006 for

example, the government set a limit to Internet speed. According to this order ISPs are not

allowed to provide households and public Internet access points (cybercafes) with a speed of

more than 128 kilobytes per second. This makes the download of multimedia content

extremely difficult. The high speed ban still exists today. Only universities and private

businesses dispose of high-speed broadband internet service. There was an escalation of

censorship and civil society opposition during the 2009 presidential elections.

2009 presidential election

The presidential elections took place on June 12, 2009. The current president, Mahmoud

Ahmadinejad, had several contesters. The reformist Mir-Hossein Mousavi was perceived as

the strongest opponent. Ahmadinejad received 62.6 percent while Mousavi got 33.8% of the

votes. Mousavi and his followers expressed concerns regarding the election result and accused

31
OpenNet Initiative (2009)
32
Reporters Sans Frontières (2009)
33
OpenNet Initiative (2005)
11
the government of fraud. Several censorship measures prior to the election provided fuel for

the fraud allegations.

Prior to the elections, the Ahmadinejad government issued an amendment for the Press

Law which aimed at applying the Press Law rules to domestic news sites and Web pages.

Personal web pages and blogs might fall under this law thereby undermining the freedom of

speech on the Internet. Ultimately, the amendment makes it mandatory to obtain a license for

Web pages. The result of this amendment is that “bloggers and online media sources would

also be subject to the regulatory authority of the Press Supervisory Board under Ministry of

Islamic Culture and Guidance, which has the power to revoke licenses, ban publications, and

refer complaints to a special Press Court”34. This amendment was initiated in April 2009

under the pressure of the Ahmadinejad government shortly before the elections. Critical

voices indicate that Ahmadinejad tried to decrease the online influence of political

competitors35. Moreover, online and mobile communication traffic was frequently blocked

and monitored. Several sites, including Google and Yahoo were blocked and did not load,

which made e-mail inaccessible. Additionally, several social networking platforms such as

Facebook and Twitter were blocked in spring 200936. Those platforms were especially used

by reformists for political organising and campaigning37. Ahmadinejad and his government

denied having blocked these sites. Other social networking websites which had been

frequently blocked prior to the elections were MySpace.com, flickr.com, YouTube.com and

orkut.com38. Besides internet traffic blocking, the Iranian government increasingly monitored

online communication before and after the elections. The OpenNet Initiative reported that

arrested female activists were confronted with transcripts of their instant messaging

34
OpenNet Initiative (2009): 5
35
OpenNet Initiative (2009)
36
Bozorgmehr (2009); The Guardian (2009)
37
Amnesty International (2009)
38
OpenNet Initiative (2009)
12
communication39. This indicates that the Iranian authorities dispose of comprehensive

monitoring tools which allow them to interrogate data. Those monitoring activities might have

been the reason for the decrease in internet speed prior to, during and after the elections40. The

low speed made information uploads and downloads nearly impossible.

Iran civil society’s election reaction: A green Twitter revolution

After the controversial election results, demonstrations, riots and street battles between

Mousavi followers and military groups followed. Mousavi followers used social media

platforms such as Facebook and Twitter to organise demonstrations, mobilise protests against

the government and inform the public. In the Facebook group “Where is my vote” around

17,000 members exchanged their views on the dubious Iranian presidential elections41.

Besides the organisation of demonstrations, university students used Twitter and the video

platform You.Tube to provide minute-by minute updates on the latest developments in

Tehran42. The real-time messages on Twitter and video clips enabled people from all over the

world to get an overview of the riots and political situation in Iran. The international attention

was so intense that Twitter postponed its regular maintenance work in order to ensure the

information flow from Iran to the outside world43.

The Iranian government reacted to the increased use of Twitter and other social media

platforms by slowing down the Internet speed and blocking the Websites temporarily44. Apart

from internet traffic blocking and monitoring, mobile communication was constrained after

the election. The Committee to Protect Journalists reported that mobile phone services as well

39
OpenNet Initiative (2009)
40
Cellan-Jones, R. (2009).
41

http://www.facebook.com/search/?q=where+is+my+vote&init=quick#/group.php?gid=84334119822&ref=sear
ch&sid=598790785.3327886261..1
42
Washington Times (2009)
43
The Washington Post (2009)
44
Rhoads, C.; Fowler, G. A. and Cummins, C. (2009)
13
as short message services45 have now and then been interrupted in Iran46. Despite the

governmental censorship, election protests continued in summer 2009. However the

monitoring capabilities of the Iranian institutions enabled government representatives to

interfere, block messages and even identify and locate the sender of specific messages. It has

been reported, that several women rights activists, for example, were arrested at a privately-

communicated meeting point which indicates that their private communications must have

been monitored47. Hence, the monitoring capabilities made it possible to locate and arrest

dissidents. Once arrested, dissidents often become victims of torture and threats as the latest

report of Amnesty International summarises48: beatings, ill-treatment and forced confessions.

Governmental (violent) actions against dissidents (harassment and persecution) were

noticeable in the decline of online activities by anti-government activists in late summer 2009:

National bloggers who posted critical viewpoints about the government and election results

were arrested and beaten and their blogs disappeared49. Amnesty International reports that

some of its former Iranian informants ceased all form of communication with them as they are

threatened by military groups. The issue of how the Iranian government managed to set up

such a sophisticated censoring and monitoring system, increasingly gained public attention in

the summer of the election.

Global civil society reaction to NSN deal with Iran

The controversial election results, the protest escalation and the increasing reports

about the Iranian censorship triggered the speculation about how the Iranian government

acquired those monitoring capabilities. Shortly after the elections, the media reported that

45
BBC News (2009)
46
Committee to Protect Journalists (2009)
47
Lake (2009)
48
Amnesty International (2009)
49
Gross (2009)
14
NSN assisted the Iranian government in setting up a solid system of monitoring and

censorship through its network technology solutions. In particular, it is claimed that NSN’s

technology enables the Iranian government to engage not only in voice monitoring of local

phone calls, but also in data and internet monitoring and deep packet inspection (see

Appendix). Deep packet inspection allows authorities to scan through data text from emails,

Internet phone calls and instant messaging and search those for specific keywords. Within

milliseconds the data is deconstructed, examined for keywords and then reconstructed again50.

According to media reports, the Iranian government experimented with the technology in

early 2009 but then used it especially after the elections. A network engineer reveals in the

Wall Street Journal that such a monitoring technology as provided by NSN enables the

government “to do very complex tracking on the network”51. Even though news reports could

not confirm whether it is really NSN’s technology which the Iranian government uses to

monitor its population, civil society and human rights groups continuously link NSN with the

oppressive Iranian regime. Human rights groups condemn such business deals as they

undermine the freedom of speech and suppress dissent. Civil society actors call for boycotts

of Nokia and Siemens products52 and illustrate their criticism, amongst others, through

adbusting: Nokia’s slogan “connecting people” is changed to “Connecting Dictators”,

“Disconnecting people”, or “Spying People”53 and “Jailing People”54 and “Shooting

People”55.

50
http://online.wsj.com/article/SB124562668777335653.html
51
Rhoads and Chao (2009)
52
Kamali Dehghan, S. (2009).
53
http://s3.causes.com/photos/RZ/Uf/HM/H1/x3/8T/Eh/0wJ.jpg
54
http://islamtxt.files.wordpress.com/2009/06/nokia_jailing_09_11.jpg
55
http://niacblog.files.wordpress.com/2009/08/nokia.jpg
15
October 1, 2009, Nokia Siemens Networks headquarters in Espoo, Finland

Suri reviewed the press articles about Iran’s censorship and 2009 elections carefully

and started thinking... True, filtering mechanisms in the wrong hands can have bad effects, but

isn’t it better to provide people with communication than with nothing at all? Besides, NSN

only did its business and obeyed the laws. Finally, NSN sold the department, Intelligent

Solutions business, which used to sell those monitoring centres and software solutions to the

German holding company Perusa Partners Fund LLP in March 2009. This business is not part

of its core business anymore. He closed the dossier.

Questions

1. What might be the perception of the Iran dossier by Suri?

2. What are the moral arguments for and against the business deal with the Iranian

government?

3. Do Nokia Siemens Networks bear responsibility for the recent events in Iran after the

2009 elections?

16
 Appendix
Images

17
Wall Street Journal article on NSN’s business activities with Iran56

Iran's Web Spying Aided By Western

Technology
European Gear Used in Vast Effort to Monitor
Communications
By CHRISTOPHER RHOADS in New York and LORETTA CHAO in Beijing

The Iranian regime has developed, with the assistance of European telecommunications
companies, one of the world's most sophisticated mechanisms for controlling and censoring
the Internet, allowing it to examine the content of individual online communications on a
massive scale.

Interviews with technology experts in Iran and outside the country say Iranian efforts at
monitoring Internet information go well beyond blocking access to Web sites or severing
Internet connections.

Instead, in confronting the political turmoil that has consumed the country this past week, the
Iranian government appears to be engaging in a practice often called deep packet inspection,
which enables authorities to not only block communication but to monitor it to gather
information about individuals, as well as alter it for disinformation purposes, according to
these experts.

The monitoring capability was provided, at least in part, by a joint venture of Siemens AG,
the German conglomerate, and Nokia Corp., the Finnish cellphone company, in the second
half of 2008, Ben Roome, a spokesman for the joint venture, confirmed.

The "monitoring center," installed within the government's telecom monopoly, was part of a
larger contract with Iran that included mobile-phone networking technology, Mr. Roome said.

"If you sell networks, you also, intrinsically, sell the capability to intercept any
communication that runs over them," said Mr. Roome.

The sale of the equipment to Iran by the joint venture, called Nokia Siemens Networks, was
previously reported last year by the editor of an Austrian information-technology Web site
called Futurezone.

The Iranian government had experimented with the equipment for brief periods in recent
months, but it had not been used extensively, and therefore its capabilities weren't fully
displayed -- until during the recent unrest, the Internet experts interviewed said.

56
http://online.wsj.com/article/SB124562668777335653.html
18
"We didn't know they could do this much," said a network engineer in Tehran. "Now we
know they have powerful things that allow them to do very complex tracking on the network."

Deep packet inspection involves inserting equipment into a flow of online data, from emails
and Internet phone calls to images and messages on social-networking sites such as Facebook
and Twitter. Every digitized packet of online data is deconstructed, examined for keywords
and reconstructed within milliseconds. In Iran's case, this is done for the entire country at a
single choke point, according to networking engineers familiar with the country's system. It
couldn't be determined whether the equipment from Nokia Siemens Networks is used
specifically for deep packet inspection.

All eyes have been on the Internet amid the crisis in Iran, and government attempts to crack
down on information. The infiltration of Iranian online traffic could explain why the
government has allowed the Internet to continue to function -- and also why it has been
running at such slow speeds in the days since the results of the presidential vote spurred
unrest.

Users in the country report the Internet having slowed to less than a tenth of normal speeds.
Deep packet inspection delays the transmission of online data unless it is offset by a huge
increase in processing power, according to Internet experts.

Iran is "now drilling into what the population is trying to say," said Bradley Anstis, director of
technical strategy with Marshal8e6 Inc., an Internet security company in Orange, Calif. He
and other experts interviewed have examined Internet traffic flows in and out of Iran that
show characteristics of content inspection, among other measures. "This looks like a step
beyond what any other country is doing, including China."

China's vaunted "Great Firewall," which is widely considered the most advanced and
extensive Internet censoring in the world, is believed also to involve deep packet inspection.
But China appears to be developing this capability in a more decentralized manner, at the
19
level of its Internet service providers rather than through a single hub, according to experts.
That suggests its implementation might not be as uniform as that in Iran, they said, as the
arrangement depends on the cooperation of all the service providers.

The difference, at least in part, has to do with scale: China has about 300 million Internet
users, the most of any country. Iran, which has an estimated 23 million users, can track all
online communication through a single location called the Telecommunication Infrastructure
Co., part of the government's telecom monopoly. All of the country's international links run
through the company.

Separately, officials from the U.S. embassy in Beijing on Friday met with Chinese officials to
express concerns about a new requirement that all PCs sold in the China starting July 1 be
installed with Web-filtering software.

If a government wants to control the flow of information across its borders it's no longer
enough to block access to Web sites hosted elsewhere. Now, as sharing online images and
messages through social-networking sites has become easy and popular, repressive regimes
are turning to technologies that allow them to scan such content from their own citizens,
message by message.

Human-rights groups have criticized the selling of such equipment to Iran and other regimes
considered repressive, because it can be used to crack down on dissent, as evidenced in the
Iran crisis. Asked about selling such equipment to a government like Iran's, Mr. Roome of
Nokia Siemens Networks said the company "does have a choice about whether to do business
in any country. We believe providing people, wherever they are, with the ability to
communicate is preferable to leaving them without the choice to be heard."

Countries with repressive governments aren't the only ones interested in such technology.
Britain has a list of blocked sites, and the German government is considering similar
measures. In the U.S., the National Security Agency has such capability, which was employed
as part of the Bush administration's "Terrorist Surveillance Program." A White House official
wouldn't comment on if or how this is being used under the Obama administration.

The Australian government is experimenting with Web-site filtering to protect its youth from
online pornography, an undertaking that has triggered criticism that it amounts to
government-backed censorship.

Content inspection and filtering technology are already common among corporations, schools
and other institutions, as part of efforts to block spam and viruses, as well as to ensure that
employees and students comply with computer-use guidelines. Families use filtering on their
home computers to protect their children from undesirable sites, such as pornography and
gambling.

Internet censoring in Iran was developed with the initial justification of blocking online
pornography, among other material considered offensive by the regime, according to those
who have studied the country's censoring.

20
Iran has been grappling with controlling the Internet since its use moved beyond universities
and government agencies in the late 1990s. At times, the government has tried to limit the
country's vibrant blogosphere -- for instance, requiring bloggers to obtain licenses from the
government, a directive that has proved difficult to enforce, according to the OpenNet
Initiative, a partnership of universities that study Internet filtering and surveillance. (The
partners are Harvard University, the University of Toronto, the University of Cambridge and
the University of Oxford.)

Beginning in 2001, the government required Internet service providers to install filtering
systems, and also that all international connections link to a single gateway controlled by the
country's telecom monopoly, according to an OpenNet study.

Iran has since blocked Internet users in the country from more than five million sites in recent
years, according to estimates from the press-freedom group Reporters Without Borders.

In the 2005 presidential election, the government shut down the Internet for hours, blaming it
on a cyberattack from abroad, a claim that proved false, according to several Tehran
engineers.

Several years ago, research by OpenNet discovered the government using filtering equipment
from a U.S. company, Secure Computing Corp. Due to the U.S. trade embargo on Iran, in
place since the 1979 Islamic revolution overthrew the U.S.-backed shah, that was illegal.
Secure Computing, now owned by McAfee Inc., at the time denied any knowledge of the use
of its products in Iran. McAfee said due diligence before the acquisition revealed no contract
or support being provided in Iran.

Building online-content inspection on a national scale and coordinated at a single location

requires hefty resources, including manpower, processing power and technical expertise,
Internet experts said.

Nokia Siemens Networks provided equipment to Iran last year under the internationally
recognized concept of "lawful intercept," said Mr. Roome. That relates to intercepting data for
the purposes of combating terrorism, child pornography, drug trafficking and other criminal
activities carried out online, a capability that most if not all telecom companies have, he said.

The monitoring center that Nokia Siemens Networks sold to Iran was described in a company
brochure as allowing "the monitoring and interception of all types of voice and data
communication on all networks." The joint venture exited the business that included the
monitoring equipment, what it called "intelligence solutions," at the end of March, by selling
it to Perusa Partners Fund 1 LP, a Munich-based investment firm, Mr. Roome said. He said
the company determined it was no longer part of its core business.

-- Ben Worthen in San Francisco, Mike Esterl in Atlanta and Siobhan Gorman in Washington
contributed to this article.

Write to Christopher Rhoads at christopher.rhoads@wsj.com and Loretta Chao at

loretta.chao@wsj.com

Printed in The Wall Street Journal, page A1

21
NSN press release regarding its business with Iran

Provision of Lawful Intercept capability in

Iran57
Espoo, Finland, June 22, 2009

Recent media reports have speculated about Nokia Siemens Networks' role
in providing monitoring capability to Iran. Nokia Siemens Networks has
provided Lawful Intercept capability solely for the monitoring of local voice
calls in Iran. Nokia Siemens Networks has not provided any deep packet
inspection, web censorship or Internet filtering capability to Iran.

In most countries around the world, including all EU member states and the U.S.,
telecommunications networks are legally required to have the capability for Lawful Intercept
and this is also the case in Iran. Lawful Intercept is specified in standards defined by ETSI
(European Telecommunications Standards Institute) and the 3GPP (3rd Generation
Partnership Project).

To fulfill this Lawful Intercept requirement as part of an expansion to provide further mobile
connectivity to Iran in the second half of 2008, Nokia Siemens Networks provided TCI, the
Iranian national operator, with the capability to conduct voice monitoring of local calls on its
fixed and mobile network.

The restricted functionality monitoring center provided by Nokia Siemens Networks in Iran
cannot provide data monitoring, internet monitoring, deep packet inspection, international call
monitoring or speech recognition. Therefore, contrary to speculation in the media, the
technology supplied by Nokia Siemens Networks cannot be used for the monitoring or
censorship of internet traffic.

On March 31st, 2009 Nokia Siemens Networks and Perusa Partners Fund I L.P., a private
investment firm advised by Munich based Perusa GmbH, successfully closed the sale of
Nokia Siemens Networks' Intelligence Solutions business to Perusa. Nokia Siemens Networks
made the decision to exit this business as it primarily addresses customer segments which
differ from telecom service providers and is therefore not part of Nokia Siemens Networks
core business.

In all countries where it operates the company does business strictly in accordance with the
Nokia Siemens Networks Code of Conduct and in full compliance with UN and EU export
control regulations and other applicable laws and regulations.

Nokia Siemens Networks provides the mobile technology for millions of people in Iran to
communicate with each other and the outside world. Nokia Siemens Networks firmly believes

57
http://www.nokiasiemensnetworks.com/press/press-releases/provision-lawful-intercept-capability-iran
22
that providing people, wherever they are, with the ability to communicate ultimately benefits
societies and brings greater prosperity.

To comment on this story please visit http://blogs.nokiasiemensnetworks.com/news

About Nokia Siemens Networks

Nokia Siemens Networks is a leading global enabler of telecommunications services. With its
focus on innovation and sustainability, the company provides a complete portfolio of mobile,
fixed and converged network technology, as well as professional services including
consultancy and systems integration, deployment, maintenance and managed services. It is
one of the largest telecommunications hardware, software and professional services
companies in the world. Operating in 150 countries, its headquarters are in Espoo, Finland.
www.nokiasiemensnetworks.com

Engage in conversation about Nokia Siemens Networks' aim to reinvent the connected world
at http://unite.nokiasiemensnetworks.com and talk about its news at
http://blogs.nokiasiemensnetworks.com
Find out if your country is exploiting the full potential of connectivity at
http://connectivityscorecard.org

Media Enquiries

Nokia Siemens Networks

Press office
Phone: +358 7180 31451
E-mail: mediarelations@nsn.com

23
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