Chipmaker Infineon has moved one step closer to supplying chips for high-end devices of Nokia by announcing a collaboration to create chips for the next mobile network generation.

Infineon, which already supplies chips to Nokia -- the world's largest maker of mobile phones -- said on Wednesday the cooperation was aimed at making Nokia's current and future modem technology work with Infineon's transceiver chips.

The company said this would create a product for the fourth-generation (4G) Long-Term Evolution (LTE) technology, the next step in mobile networks that will make possible wireless high-speed Internet connections. The first such networks are expected for 2011.

At 1124 GMT, shares in Infineon were flat, while Nokia shares gained 0.5 percent. The DJ STOXX European Technology Index was up 0.2 percent.

The mobile industry has not settled on a standard for 4G networks, with some operators and developers backing Sprint Nextel Corp's WiMax technology, while others promote the LTE system.

Canada's Nortel Networks has previously said it sees LTE as the most likely upgrade path for about 80 percent of the world's existing mobile phone providers.

(Reporting by Christoph Steitz in Frankfurt and Jens Hack in Munich; editing by Elaine Hardcastle)

Electronics