Telecom equipment giant Nokia is reportedly exploring options for its mobile networks business, with potential interest from South Korea’s Samsung Electronics.
Nokia is considering several possibilities, including the divestment or sale of parts or all of its mobile networks division. The mobile networks business of Nokia could be valued at up to $10 billion, according to Bloomberg News.
Nokia in a statement said it has nothing to announce in relation to the speculations published in an article today, and no related insider project exists.
Nokia said it is committed to the success of its Mobile Networks business, a highly strategic asset for both Nokia and its customers.
“The business has made significant progress this year both on right-sizing its cost-base while protecting its product roadmap and winning new deals with new customers and increasing share with existing customers,” Nokia said.
Nokia said it is focused on ensuring that Mobile Networks is positioned to serve its customers building the best performing networks, investing in its portfolio and creating value for Nokia’s shareholders.
Bloomberg News said Nokia might consider merging the mobile networks unit with a competitor. These considerations come in the wake of a significant 32 percent drop in Nokia’s second-quarter operating profit, driven by weaker demand for 5G telecom equipment.
Nokia has lost considerable business last year when AT&T, the leading mobile operator in the United States, decided to shift to its RAN contract to Ericsson. Nokia is working with two leading telecom operators in India — Bharti Airtel and Reliance Jio — for their 5G network roll out.
Samsung NW business
Samsung, known as the world’s leading manufacturer of memory chips, smartphones, and televisions, has reportedly shown initial interest in acquiring certain Nokia assets. This move aligns with Samsung’s goal to strengthen its position in the radio access networks (RAN) sector.
Nokia has declined to comment on market rumors or speculation. The Finnish company reiterated its commitment to the success of its Mobile Networks division, emphasizing its strategic importance to both Nokia and its customers.
Samsung Electronics has been struggling to grow its telecom network business due to competition. Samsung Electronics could not clinch deals when Huawei exited from some of the top telecom markets.
Samsung Electronics has some presence in telecom markets such as the United States, South Korea and Japan. Samsung Electronics is aiming to grow in Europe and East Asia. Samsung says it has leadership in vRAN with deployment 38,000 sites. Samsung never revealed its revenue from network business.
Mobile Networks business is challenging for both Samsung and Nokia. The estimated Mobile Networks addressable market for 2023 was EUR 43 billion and is estimated to have declined 13 percent in 2023 against the previous projection of 5 percent growth, according to analyst reports.
Nokia Mobile Networks business
Tommi Uitto is the President of Nokia Mobile Networks business.
In 2023, Nokia’s Mobile Networks sales fell 8 percent to EUR 9.8 billion. Nokia Mobile Networks business delivered a segment operating margin of 7.4 percent thanks to improved product cost competitiveness, cost control measures, lower variable pay and strong execution.
Nokia Mobile Networks business reached 319 commercial 5G deals and had more than 710 private wireless customers, with 159 in 5G.
Nokia Mobile Networks business launched new AirScale massive MIMO radios and ultraperformance AirScale baseband powered by ReefShark, bringing higher capacity and connectivity, network performance, power efficiency and easy deployment.
Nokia Mobile Networks business has also launched anyRAN to drive Cloud RAN partnerships enabling flexibility for mobile network operators and enterprises.
Nokia Mobile Networks business announced acquisition of Fenix Group in the US, which strengthens its offering to the defense sector.
Nokia Mobile Networks business has also developed sales channels for Private Wireless networks via partnerships with Cisco, HPE / Athonet and Microsoft Azure.
Nokia considers Huawei, Ericsson, Samsung and ZTE as main competitors in the global RAN market. Smaller competitors competing in specific technology or regional sub-segments are NEC and Fujitsu. In microwave, key competitors include Ceragon, NEC and Aviat, alongside Huawei and Ericsson.
Baburajan Kizhakedath
