Nokia confirms, it has missed out on China mobile contract

As per news source, Nokia has confirmed that it has missed out on the largest Chinese mobile industry tender for 5G base stations to date.

The news source also reported that China Mobile has given its Phase 2 5G base station contracts to Huawei and ZTE, with a smaller share for Ericsson. The overall $5.2bn tender was for 232,143 5G base stations, “the majority of the company’s targeted buildout this year”. Huawei was awarded 57.2% by number of base stations, ZTE with 28.7% and Ericsson 11.5%. The terms of those shares are unknown, although it is known Ericsson was under severe price pressure to win even that portion of the deal.

This indicates that Nokia was left with nothing. The strike-out in 5G is despite Nokia signing a series of large scale frame agreements – often scoped to a billion Euros – with China Mobile over recent years. The most recent of these, referencing radio access network equipment as part of the frame, was in mid 2018. Later in 2018, the company added two more frame agreements with China Unicom and China Telecom, whose Phase 2 5G contract awards are still to be public. These two operators are conducting a network share for parts of the 5G network.

Up until this point, Nokia has been quiet on the 5G tender process in China, but as per news source it will continue to engage with Chinese mobile operators on 5G, despite confirming it came up empty handed this time. It said it still expects to be “a sizeable player” in China “well into the future”.

It also pointed out that the addressable market is about more than 5G base stations, and notably it also referenced the potential to “pursue opportunities” with Enterprise and Webscale players.

Here is its statement: “We are aware that China Mobile has announced its 2020 5G NR CP2 central bidding results. Nokia has been operating in China for 40 years and our commitment to China remains the same. We still expect to be a sizeable player in China well into the future and in addition to supporting the Chinese operators’ 5G ambitions, we continue to pursue opportunities with service providers in core, routing, transport, fixed access and our current 4G business, as well as with Enterprise and Webscale customers.”