Nokia focuses on innovation to expand network revenue from non-telecoms

Nokia CEO Rajiv Suri at MWC 2017Patrick Filkins, analyst at Technology Business Review recently said the revenue growth of Nokia will be under stress due to reduced capital expenditure (Capex) of telecom operators.

Nokia’s revenue and margins contracted in Q4 016, driven by revenue declines in the company’s Networks and Technologies units.

TBR said though lower Capex spend from telecom customers continues to be the driving force for revenue issues, Nokia is prudently managing engagements and rationalizing areas of its portfolio that do not align with the company’s profitability goals.

Nokia at MWC 2017

Nokia CEO Rajeev Suri has outlined how its new strategy is delivering innovation for communication service providers in network speed, agility and efficiency.

Nokia is also broadening the company’s footprint in faster-growing areas including software and the utilities and transport markets.

ALSO READ: Live news from Mobile World Congress 2017

During Nokia’s Q4 earnings call, the Finland-based technology company noted a stronger pipeline of sales to non-telecom customers into 2017.

Nokia announced that it aims to offset weakness in the telecom operator market by targeting opportunities in select adjacent markets, including public safety, tech extra-large enterprises, webscale, connectivity for IoT and cable access via Gainspeed.

Nokia’s launch – at the Mobile World Congress (MWC) in Barcelona — of solutions covering 5G, the Internet of Things (IoT), software and cloud bolstered by the acquisition of Alcatel-Lucent in 2016 – indicates its ability to target substantial growth in non-telecom revenues.

“Nokia comes to Mobile World Congress this year with a bigger and fully end-to-end portfolio to sell, and with groundbreaking innovations to share,” CEO Rajeev Suri said on Sunday addressing a press meet in Barcelona.

“Those efforts show how Nokia is expanding into vertical markets like energy, transportation, public safety and big Internet companies,” Rajiv Suri said.
Nokia 5G FirstNokia expects mobile broadband spending in its primary CSP market to increase at a CAGR of 0.4 percent between 2016 and 2021. TBR believes that it will be driven mostly be a slight Capex uplift from 5G in 2020.

While Nokia is not giving up on its telecom business, it wants to utilize Alcatel-Lucent’s products for telecoms and enterprises.

Suri said 5G FIRST, announced today, show Nokia’s innovation strength to deliver differentiated products.

5G FIRST will be the industry’s first commercial 5G product – anticipating that Huawei, ZTE and Ericsson will not launch a new product in the 5G space before Nokia.

Telefonica deal

Nokia bagged a 3-year contract from Telefonica to enhance the performance of its 4G network in London. The deal includes Nokia 4.5G Pro technology, powered by the Nokia AirScale Radio Access portfolio, Nokia Flexi Zone small cells, the Nokia NetAct network management system, Nokia Traffica real-time network analytics and Nokia Global Services.

Baburajan K

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