Nokia Winning 5G Contracts Despite Delivery Delays, CEO Says
Nokia is winning contracts “quite handsomely” in 5G networks as the top three suppliers go head-to-head for the emerging business, CEO Rajeev Suri said, according to Bloomberg.
“We compete quite favorably with Huawei, with or without the current security concerns,” Suri said in an interview with Bloomberg TV. Against fellow Nordic competitor Ericsson, “we win two-thirds of the time,” Suri said, “compared to one-third of the time that they swap us out.”
The CEO is rebutting concerns from some analysts and executives that Nokia has fallen behind in the early phases of delivering products for the fifth generation of mobile networks. A few weeks of delays “is not really much” in the context of a 15-20 year cycle, Suri said. In the first quarter, the Finnish company struggled to book revenue from the contracts it had signed, 42 globally thus far, but now expects to start recognizing revenue “soon.”
He dismissed the idea that security concerns in Europe, which have prompted some governments to tighten oversight of Huawei, could delay the rollout of 5G in the region. The technology is immune to macroeconomic downturns as “you absolutely have to invest” in 5G, he said.
Customers are choosing Nokia because it can supply a full system of hardware, or what it calls end-to-end networks, complete with software and services, Suri said. About 35% of its pipeline consisted of end-to-end orders a year ago, and that’s now up to about 49%, he said, while about half of Nokia’s 5G contracts announced to date go beyond just 5G radio.
Industrial clients want to “buy the system” and don’t care where various components come from, Suri said. Nokia already has about 1,000 such enterprise customers and adds another 150 to 200 a year, he said. Suri estimated that there will be 15 million industrial sites that will require wireless connectivity over the next 10-plus years. That compares with about 7 million base stations globally for phone carriers, currently.