Nokia loses out on another massive 5G deal in China

China Telecom, the world’s 4th largest, and China Unicom, the world’s 6th largest telecom operator, jointly announced the equipment suppliers for the 5G standalone (SA) network deployment, establishing a single nationwide 5G RAN. The value of the contract was US$25.92 billion, which was further divided into two tenders, the first tender, valued at US$ 9.31 billion, and the second tender, valued at US$16.61 billion. Nokia missed both the tenders.

The first tender was completely distributed among the Chinese companies, i.e., 50% went to Huawei and the other half went to ZTE. While, from the second tender, Ericsson, Huawei and ZTE each received a 28% share, and the remaining 16% share went to Datang Mobile Communications. If we combine both the tenders, then Huawei and ZTE, both received 35.9%, Ericsson received 17.9% and 10.3% went to Datang.

On being asked about the omission, a Nokia spokesperson said that the company respects the decision, and further, also quoted:

“We remain a long-term player in China and our commitment to China remains, but… we have always taken a conservative and transparent approach to our business in China. We continue to execute against a clear strategic goal to improve our overall business mix in the country.”

Thus, it seems normal that why Nokia in early February, excluded China from its outlook “given that pursuing market share in China presents significant profitability challenges and the region has some unique market dynamics”.

About three weeks ago, Nokia also lost the China Mobile 5G deal, valued at US$5.2 billion. Considering that Nokia was massively involved with the China’s major operators in 2018-19, with over US$2.26 billion worth of deals, Nokia losing out on the major 5G deals this year in China is very much (un)surprising, and heartbreaking for the people working at Nokia, and even for us!

Still, our heart says Eläkää Nokia! (‘Long Live Nokia’ in Finnish)