Managed Services

Nokia: A Global Network Operator for the Enterprise?

Going solo
In other instances, however, Nokia is clearly going it alone. In Australia, it has built and is managing a private mobile network for one of the country's mining companies with no telco involvement. Elhage acknowledges that both approaches could hold appeal. "In Saudi Arabia, Aramco [an oil company] might ask STC [a telco] to provide a facility or it could offer a bid for the construction of a private network," he says.

Even if Nokia is not directly competing against the telcos, its "adjacencies" strategy could be a source of friction with long-standing customers. The verticals that have caught Nokia's attention include energy, transportation, the public sector and so-called "technological extra-large enterprises." But they also feature the web-scale players, such as Google (Nasdaq: GOOG) and Amazon.com Inc. (Nasdaq: AMZN), which telcos often see as a threat to their own interests. "With new requirements they can compete in an agile way with operators, and we can generate solutions to respond to particular needs," says Elhage.

Operators cannot prevent Nokia from serving their rivals, of course, and they will continue to need its products. The potential danger for the Finnish vendor is that, in helping out non-traditional players, it inadvertently hinders the growth of its biggest customers. With sales stagnant or in decline, telco spending could take a hit.

Want to know more about the Internet of Things? Check out our dedicated IoT content channel here on Light Reading.

Ultimately, the enterprise gambit points to a blurring of the lines between equipment providers and the telcos they serve. With 5G and the "Internet of Things" more relevant to enterprises than to smartphone-wielding consumers, vendors and operators are converging on the same space.

But if Nokia is becoming more like an operator, then the likes of AT&T Inc. (NYSE: T) and Deutsche Telekom aspire to have much greater influence over the network technologies now taking shape. For signs of that, look to ECOMP, AT&T's open source software project that has attracted Orange as a development partner, or Deutsche Telekom's involvement in the Telecom Infra Project, an initiative led by Facebook and designed to spur innovation in the network equipment area. (See Orange to Focus Polish ECOMP Trials on Residential vCPE .)

Useful labels in the past, the descriptors of "vendor" and "operator" are beginning to look anachronistic.

— Iain Morris, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, News Editor, Light Reading

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kq4ym 12/17/2016 | 4:41:23 PM
Re: No time to consider potential impact... The need to adapt is certainly a key work in this new business climate. Nokia most likely will survive with some luck in their new avenue moves. Probably some profits will increase in as much "as Nokia caters to the needs of large enterprise and public sector organizations," already and can use those skills as a base along with new venture areas.
bosco_pcs 12/6/2016 | 6:01:37 PM
Re: No time to consider potential impact... But you look at the role shift in $T (Direct TV and soon $TWX) and $VZ (selling Datacenter but buying AOL and soon $YHOO), not surprised if $ERIC and $NOK become supplier/operator one stop shop 
Mitch Wagner 12/6/2016 | 1:00:56 PM
Re: No time to consider potential impact... Alienating telco customers is a risk but with that business already shrinking it does not seem Nokia has a lot to lose. 
[email protected] 12/6/2016 | 8:09:30 AM
No time to consider potential impact... The time to be considering whether a customer might get the hump over a move into a certain business area is over. ALl the major vendors are going to do this and any operator that thinks they won't is kidding themselves.

All the vendors need new business opportunities (Huawei, notably, has been aggressive in pursuing those opportunities for a number of years now and spread itself far and wide) and if, along the way, some shrinking legacy business relationship gets called into question, that's a risk that will need t be taken.

The new mantra is 'partnership' -- finding those at every opportunity, with whatever type of partner, is what's important now.

The industry has changed - now the players have to adapt.
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