Nokia sidelined as China Unicom-Telecom 5G SA contracts issued

Nokia sidelined as China Unicom-Telecom 5G SA contracts issued

China Unicom and China Telecom have followed market leader China Mobile in quietly leaving Nokia off their standalone 5G network equipment suppliers’ lists.

The second and third largest operators in China are jointly deploying a standalone 5G network. The initial CNY65.87 billion contract was split evenly between domestic vendors Huawei and ZTE, while the second CNY117.6 billion saw these vendors and Sweden’s Ericsson each receive a 28% share. The remaining 16% was granted to Datang Mobile Communications.

Overall, of the combined tender value of CNY183.5 billion ($25.92 billion), Huawei and ZTE each won 35.9%, while Ericsson was awarded 17.9% and Datang 10.3%.

While Nokia lodged a bid for the operators’ centralised procurement project, its application was unsuccessful. The Finnish vendor was also recently shunned by China Mobile as the market-leading operator moves into the second stage of its 5G rollout.

China Mobile’s contract award process was similar to its rivals but Huawei emerged as the major winner, with a 57.3% share of the newest tender. ZTE took 28.7%, Ericsson 11.5% and Datang 2.6%, so the SA contract issue has granted these vendors a larger share to Huawei’s detriment.

In a statement, the vendor said that it “remain[s] a long-term player in China” that has “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.”

Nokia has seen a series of setbacks this year, with reports earlier this month indicating that it was forced to hire an investment bank to protect itself from a hostile takeover. While the vendor has not commented on these reports, it has abruptly changed its CEO, denied plans to sell assets, and cautioned that its annual prospects are likely to suffer due to the ongoing Covid-19 pandemic.