Nokia 5G pickup could be­gin as early as 2017: CEO

The Pak Banker - - COMPANIES/BOSS -

Mo­bile equip­ment maker Nokia sees the shift to the next gen­er­a­tion of 5G wire­less net­works kick­ing off well ahead of 2020, the year when many in the in­dus­try con­sider mass-mar­ket up­grades will be­gin, its chief ex­ec­u­tive said on Sun­day.

Chief ex­ec­u­tive Ra­jeev Suri said the com­pany plans to pick up in­vest­ment in 5G tech­nol­ogy in 2016 and that sales of 5G-ready equip­ment ca­pa­ble of fu­ture up­grades could be­gin as early as 2017. "5G will hap­pen faster than ex­pected. This may sur­prise some of you," Suri de­clared to an au­di­ence in­clud­ing in­vestors ahead of the Mo­bile World Congress in Barcelona this week.

Suri said that in con­trast to past "big bang" roll­outs of older mo­bile equip­ment cy­cles, 5G will re­quire plenty of equip­ment up­grades to oc­cur be­fore some of the key 5G stan­dards are ex­pected to be for­malised in 2018 and 2019. "2020 is prob­a­bly where we see global vol­ume de­ploy­ments," Suri said, but added: "We will start to see a lot of ac­tion ahead of 2020- in 2017, 2018, 2019." De­mand for cur­rent 4G equip­ment peaked in 2015 af­ter mas­sive roll­outs were com­pleted in China, the world's big­gest mo­bile mar­ket, and some an­a­lysts are con­cerned Nokia could suf­fer years of flat or de­clin­ing sales un­til 5G picks up later this decade.

Un­like the pre­vi­ous 2G, 3G and 4G cy­cles which de­liv­ered mo­bile voice call­ing, text, pic­tures and video to phones and com­put­ers, 5G will also hook up cars, cities, man­u­fac­tur­ing plants and agri­cul­ture, or the so-called "In­ter­net of Things". Ear­lier this month, Nokia warned in­vestors to ex­pect "flat­tish" cap­i­tal spend­ing from net­work oper­a­tors in 2016 and to brace for a pos­si­ble de­cline in its mo­bile net­work busi­ness.

Nokia, which closed its €15.6 bil­lion ac­qui­si­tion of Al­ca­tel Lu­cent in Jan­uary, is look­ing to stronger growth in fixed line equip­ment from the re­cently ac­quired busi­ness, as well as 900 mil­lion euros in cost sav­ings through 2018 to help it shore up prof­its in the near- to medium-term. The com­pany has said it will not pro­vide an out­look for 2016 for the newly com­bined com­pa­nies un­til May. Dur­ing his speech, Suri high­lighted SK Tele­com's am­bi­tion to have 5G-ready net­works run­ning in time for the 2018 Win­ter Olympics in South Korea and Ja­pan's NTT DoCoMo's sim­i­larly ag­gres­sive time­frames for mov­ing to 5G. An­other un­named cus­tomer will use 5G to solve its "last mile" prob­lem of reach­ing lo­cal cus­tomers with­out mak­ing fur­ther in­vest­ments in broad­band ca­bling, he said.

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