Nordic winter hits hard as Ericsson loses exec and Nokia cuts more jobs

Swedish Ericsson and Finnish Nokia both announced they’re losing people as the endless winter nights take their toll.

Ericsson’s SVP, Chief Marketing and Communications Officer and Head of Marketing and Corporate Relations, Helena Norrman, is calling it a day after 21 years at the company, with ten of those on the executive team. She’ll be hanging around for a quarter or two, to keep the transition smooth and presumably have a hand in finding her replacement.

“Helena has been instrumental in reshaping and modernizing Ericsson’s global marketing and communications strategy and function,” said Ericsson CEO Börje Ekholm. “With a deep understanding of the company’s priorities she has helped Ericsson navigate through periods of both massive change and considerable challenges. Helena has been a valued member of the Executive Team and I wish her all the best in her future ventures.”

On a personal note, I got a chance to hang out with Helena when I was over in Stockholm last summer and found her to be smart and tough, but at the same time friendly and approachable, in other words great at her job. I’m sad to see you go Helena, but wish you all the best with your next thing. Here were are getting the beers in, on a boat in Stockholm, with Helena on the right.

Ericsson tour boat beers

Over in Helsinki Nokia is trimming another 350 Finnish employees in a further dive to cut costs, as previously reported by Light Reading. “Our industry is one where a constant focus on costs is vital and the planned transformation measures are essential to secure Nokia´s long-term competitiveness,” said Tommi Uitto, Nokia’s Country Manager in Finland. “Such decisions are not easy, but we will do our utmost to support our personnel during the change process.”

“Nokia has made good progress in executing on its strategy, with momentum in providing high-performance end-to-end networks, targeting new enterprise segments and creating a standalone software business. Our early progress in 5G is strong and we continue to increase our investment in this critical technology.

“We will redouble our efforts to ensure that Nokia’s disciplined operating model remains a source of competitive advantage for us, and that we maintain our position as the industry leader in cost management, productivity and efficiency. Finland will continue to be an important country for Nokia to achieve these goals. To this end, we are also currently recruiting into key new technologies in all our campuses in Finland.”

On one hand any job loss announcement sends out the message that the company is struggling to make a profit. But as Uitto noted, this sort of thing is not uncommon among kit vendors and Ericsson has been on a massive downsizing of its own, so these 350 redundancies need to be kept in perspective. Meanwhile Norrman’s departure is a loss to Ericsson, but maybe it will take this opportunity to get someone in from the outside with a different perspective on the company.

Telefónica pulls its SOCs up with Nokia’s help

Operator group Telefónica is changing its UK Network Operations Center into a Service Operations Center to show how customer-centric it is.

That was the distilled message from a press launch in central London this morning, co-hosted by its vendor for this project – Nokia. Building a SOC will allow O2 UK to make customer-led, as opposed to engineering-led, decisions about its network, we were told by Brandan O’Reilly, the CTO of O2 UK.

Telefónica has apparently already got started on this process in some of its other markets, including Chile and Germany, but this is a first for the UK and also the first time Nokia has been the vendor. So this seems like a big deal for them – hence the press event.

Tim Smith, VP of Nokia Software Europe, explained its SOC platform aggregates and standardises the various network data feeds in order to be able to compare and optimise them. It’s all about being proactive rather than reactive when it comes to network management and AI seems to play a big part, as you might expect.

A lot of the questions from the grizzled telecoms hacks in attendance focused on what specific benefits a SOC offers over a NOC and how they might be measured. While reduced churn is an obvious way to track ‘customer delight’, as Smith put it, Telefonica has its own metric called NCX (Network Customer Experience), which is currently at 79 and O’Reilly hopes will jump by at least a couple of points as a result of this shift. Here are the canned quotes from the press release.

“Telefónica has always aimed to offer the best possible experience to our customers which a reactive network monitoring approach to operations could never guarantee,” said Juan Manuel Caro, director of network and IT operations at Telefónica. “With SOC we have already transformed this in three of our markets reaching the next level in automated customer experience management, granting us flexibility and adaptability that serves as a key differentiator. Nokia’s solutions and services will allow us to achieve this goal in a competitive market like the UK.”

“Telefónica is pioneering the transformation toward customer-centric operations with the deployment of Nokia eSOC,” said Bhaskar Gorti, president of Nokia Software. “Nokia is proud to support Telefónica’s digital transformations and SOC deployments across the globe and with the flexibility to adapt to existing ecosystems in local markets.”

This all seems like quite a lot of effort to go to just to labour the ‘customer-centric’ concept that has become endemic to the point of cliché in the business world. But to be fair to both companies they are at least announcing concrete measures being taken in pursuit of that aim and thus holding themselves publicly accountable for delivering it.

Huawei enters 2019 swinging with $108.5 billion revenues

To say 2018 was a rollercoaster ride for Huawei would be somewhat of an understatement, but the New Year’s message from Rotating Chairman Guo Ping is one of defiance.

Ping has proudly stated the business has reached record sales revenues in 2018, $108.5 billion, signed 26 5G commercial contracts with telcos, shipped more than 10,000 5G base stations, tempted 160 cities and 211 Fortune Global 500 companies into digital transformation contracts and shipped more than 200 million smartphones.

The company might have been the antagonist in the Great Security Saga of 2018, but it is still moving in the right direction. That is, for the moment at least. This message from Ping is one of reassurance. Huawei is proactively seeking to engagement the community, promising everything is above board and legitmate. This is a business which is scrapping for its reputation.

“It has been an eventful year, to say the least,” said Ping. “But we have never stopped pushing forward, and as a result our 2018 sales revenue is expected to reach 108.5 billion US dollars, up 21% year-on-year.”

Reading between the lines you have to wonder whether the business is worried about its dependence on the US. Prior to Christmas, Rotating CEO Ken Hu promised the company’s supply chain was in a stronger position than ZTE, and there was no chance a ban from using US components and IP would create the same disaster zone. Ping seems to be reiterating this message.

“In 2019, we will focus on strategic businesses and strategic opportunities and build a more resilient business structure,” said Ping. “We will continue to optimize our product investment portfolio to achieve end-to-end strategic leadership. As part of this, we need to retain products that are competitive and appealing and phase out those that aren’t.”

Huawei are in a worrying position right now, teetering on a knifes edge. On one side, you have an incredibly successful and innovative business, with a proven track record of delivering results and a culture of account management rivalled by few. This is a vendor a lot of telcos will want to work with. However, with the echoes of accusation getting louder, governments excluding it from 5G bonanzas and the possibility of being banned from using any US goods in its supply chain, some will naturally be nervous about entering into any commercial contract.

The security concerns which plagued Huawei for the majority of 2018, accelerating in the final quarter, look like they will continue over the next couple of months but there hasn’t been an immediate impact on the business just yet. With numerous contracts already secured, Huawei is certainly not going to disappear from the connectivity landscape, but in choosing not to mention any financial predictions for 2019, Huawei has effectively stated what we are all thinking; its dominance is coming to an end.

Looking at the major vendors across the 4G era, the story was relatively clear; Huawei freely counted the cash at the expense of others, most notably Ericsson and Nokia. This will not be the story for 5G as more telcos look for greater diversity in the supply chain and governments place more scrutiny on Huawei, as well as Chinese vendors in general. Perhaps there will not be such a clear winner in the 5G era, with the bounties being more evenly spread throughout the ecosystem.

Huawei is promising to be more secure, more transparent and more innovative than competitors, and it needs to be. But we suspect the damage has already been inflicted. Success seems to have been the downfall for Huawei, forcing the company into the limelight and raising its profile so much questions were bound to be asked. Huawei will certainly continue to be a heavyweight in the connectivity industry, but its era of such spectacular dominance seems to be over.

Nokia has a great week by simply not screwing anything up

Christmas has come early for Finnish kit vendor Nokia, with its competitors bestowing it with presents of breath-taking generosity.

Huawei was the first to smash through the secret Santa threshold, at least indirectly, when BT confirmed that Huawei would not be considered to contribute to its 5G core infrastructure and that it’s also being removed from legacy cores. This marked the first time a UK operator had directly addressed the matter of Huawei and 5G kit and would appear to be part of the move against Huawei by the US and its allies.

But that was just a stocking filler compared to what the US had under the tree. In a gesture of unprecedented aggression and hostility the US persuaded Canada to arrest Huawei’s CFO and daughter of its founder, Meng Wanzhou, and wants to extradite her to the US in order to face as yet unspecified charges.

This move is unrelated to all the stuff around 5G security and concerns suspected violations of US sanctions against certain countries. This is what drove ZTE so close to extinction earlier this year and would appear to be as much a front in the trade and political war between the US and China as it is any specific point of order. It also marks a significant escalation since no ZTE execs were subjected to this kind of legal rough treatment, and to add insult to injury it looks like some ZTE documents are being used in evidence against Huawei.

Huawei’s misfortunes alone must have had Nokia execs reaching for the breakfast bucks fizz, but when it emerged that Ericsson was responsible for major outages at some of its MNO core network partners they presumably ordered a whole new shipment of champers. The fact that Huawei is desperate to divert attention onto the Ericsson thing too must have resulted in port and brandy being added to the celebratory mix. Nokia’s resulting hangover may have been slightly exacerbated by the apparently effective damage limitation done by Ericsson, but on balance it can reflect on a pretty catastrophic week for the competition.

Nokia has sent out a few press releases this week but whatever incremental achievements they claim pale into insignificance compared to the misfortunes of Huawei and Ericsson. In the run up to Christmas Nokia would be well advised to focus all its resources on simply not screwing anything up and letting its competitive environment take care of itself.

Nokia bags €250mn loans from NIB

The Nordic Investment Bank (NIB) has agreed to write Nokia a €250 million cheque in the pursuit of 5G riches.

The loan, which has an average maturity of approximately five years after disbursement, will be used to fuel the 5G ambitions of Nokia in Europe in 2018-2020, with a particular focus on new 5G-related end-to-end product offerings for different verticals.

“The business opportunities of 5G are numerous, as it will be the first mobile generation designed from the beginning for machine-type communication,” said Henrik Normann, CEO of NIB. “Nokia’s research and development is likely to benefit not just the telecom sector, but also several high-technology operators in our member countries.”

“We are pleased to receive this financing commitment from the NIB, which shares our view of the revolutionary nature of 5G,” said Kristian Pullola, CFO of Nokia. “This financing will further support 5G research and development in Europe and it bolsters the momentum we have already seen this year as the era of 5G begins.”

Nokia’s most recent talking points and press packs have focused primarily around network slicing and 5G, and it looks like this is where this investment surge will be directed. While this might look like some favouritism from the NIB, Ericsson has in the past received a very similar loan from the European Investment Bank (EIB). With the 5G bonanza seemingly just around the corner, both these businesses will have to prove they are in better shape than Huawei to capitalise on the opportunity.

In some markets, the work is being done for them, though neither Nokia or Ericsson can rely on the increasingly frowned upon Huawei reputation to win business. Despite collecting some high-profile bans around the world, Huawei would still be deemed by some as the leader in the 5G race, collecting momentum from the bumper pay day which was 4G.

5G is not far away anymore, and both Ericsson and Nokia have been keeping investors happy with the lure of profits. It wouldn’t be too long before they have to deliver on the promise.

Nokia and StarHub boast of completed 5G NR trial Singapore

Nokia and the Singapore mobile operator StarHub conducted an outdoor pilot of both industrial and consumer use cases on 5G New Radio (NR).

The two companies made another claim for Singapore’s “5G first” drive with this outdoor 3GPP compliant trial on 3.5 GHz. Two use cases were demonstrated to their staff, industry partners, and enterprise customers. The first one for industry was a simulated manufacturing environment, where businesses can use 5G-based video analytics to optimise efficiency and reduce errors. The use case for consumers was a 5G-based VR immersive video experience of live sport events. The trial was done in non-standalone (NSA) mode, with Nokia’s 5G AirScale radio access overlaying on top of StarHub’s 4G core networks. The third-party that supplied the consumer VR terminals has not been identified.

“This successful pilot with Nokia showcases the readiness and possibilities of 5G to enhance consumer services and boost efficiencies for enterprises. It aligns with StarHub’s goal to support and accelerate Smart Nation initiatives in Singapore,” said Chong Siew Loong, Chief Technology Officer of StarHub.

“Nokia is able to offer customers such as StarHub a pre-integrated and ultra-optimised network using its 5G Future X end-to-end architecture to accelerate the launch of 5G. Leveraging this technology, customers such as StarHub can achieve greater operational efficiencies and higher performance as they begin to deliver enhanced mobile broadband services,” added Tommi Uitto, president of Mobile Networks at Nokia.

Singapore is expected to be among the first countries to switch on commercial 5G networks. With its competitor Singtel busy trialling 5G and claiming its own “firsts”, StarHub must have felt the heat to not to be seen left behind. as industry momentum towards 5G NR is gathers momentum. After more than 40 companies signed the agreement in March 2017 to accelerate 5G NR development, much progress has been made on both the standardisation and the implementation fronts. Both the standalone (SA) and non-standalone variants of the 5G NR standards were completed and approved before the original deadlines.

Nokia loses its mobile network head Marc Rouanne

Finnish kit vendor Nokia has had an executive reshuffle that resulted in yet another head of its mobile networks business group calling it a day.

Marc Rouanne is a Nokia lifer who inherited the mobile crown when Samih Elhage cleared off following the last episode of corporate musical chairs at Nokia, which saw his group diminished by the separation of its services arm into its own little silo. The move is effective immediately and Nokia has wasted little time erasing him from history, which does make you wonder how amicable this latest split was.

History seems to be repeating itself as Rouanne’s departure coincides with his group being absorbed into a larger silo called the Access Networks Division, together with the fixed network group. Nokia has yet to name the head of this new super-division, which is surprising. Maybe Rouanne was lined up for the gig but then bailed at the last minute for some reason, resulting in the embarrassment of announcing a major new corporate initiative without anyone at the top of it.

Nokia has at least managed to replace Rouanne at mobile networks, with lifer Tommi Uitto stepping up from his role as head of product sales to head up the whole group. He will report into whoever they eventually find for the access networks gig.

“Nokia has a unique advantage in the 5G era with its end-to-end portfolio,” said Nokia CEO Rajeev Suri. “By creating a single Access Networks organization that includes both fixed and mobile, we can improve our customer focus, simplify our management structure, and more efficiently leverage our full portfolio.

“Tommi is a strong leader with the right background in both sales and product development and I am pleased that he has accepted this role. He brings deep credibility from across the telecommunications industry and a proven ability to drive product leadership and business performance. I want to thank Marc for his contributions to Nokia and wish him well in the future.”

Creating an overall hardware product division makes sense, given the whole point of the Alcatel-Lucent acquisition. It’s such an obvious move, in fact, that it begs the question of why it didn’t happen sooner. This will hopefully be the last corporate reshuffle required to fully incorporate A-Lu as Nokia’s going to have to start tapping the mail room for its mobile heads if this trend persists.

Nokia gets a bunch more cash from Chinese operators

Nokia is so keen for everyone to know how well it’s doing in China that is it makes an announcement every time it wins some business.

Earlier this year we heard all about a ‘framework agreement’ signed with China mobile that was worth around €1 billion. Today Nokia has announced some more ‘frame agreements’, which are presumably the same thing and refer to a kind of pre-contract that amounts to a formal commitment to do a bunch of business in future.

This time we’re talking €2 billion, but split between all three Chinese MNOs – China Mobile, China Telecom and China Unicom. Presumably the China Mobile bit is fresh cash, not just a recycling of the previous bil. The agreements cover delivery for the next year or so of radio, fixed access, IP routing and optical transport equipment, as well as some SDN and NFV goodness. Nokia is excited by all this transitioning and leveraging.

“We are excited to continue our close collaboration with these important customers in China, to drive new levels of network performance as they transition toward 5G,” said Mike Wang, president of Nokia Shanghai Bell. “Leveraging the breadth of our end-to-end network and services capabilities, we will work closely with China Mobile, China Telecom and China Unicom to deploy technologies that meet their specific business needs.”

It wouldn’t be surprising to see some kind of equivalent announcement by Ericsson before long as the two Nordic kit vendors clearly like to compete over this sort of thing. Not long after its first China Mobile announcement Nokia said it was getting £3.5 billion from T-Mobile US to help out with 5G. Within a few weeks Ericsson had countered with an almost identical announcement of its own.