Nokia CEO sees big 5G rollouts nearly a year ahead of schedule

BARCELONA/HELSINKI: Major telecom operators are accelerating their timelines for adopting next-generation 5G networks by up to a year, boosting Nokia´s confidence of an uplift for its own business later in 2018, Chief Executive Rajeev Suri said on Sunday.

The mobile network equipment industry, dominated by China´s Huawei, Finland´s Nokia and Sweden´s Ericsson , is weathering the toughest part of a decade-long cycle as demand for current fourth generation gear has slid.

The first commercial 5G roll-outs are now due to begin this year and Suri said he expected large deployments in the United States, South Korea, Japan and China to take place sooner than what the industry could have expected a year ago.

Nokia said on Sunday it had struck a partnership agreement with China Mobile - the biggest mobile operator globally by subscribers to develop new 5G networks for industrial uses across the world´s most populous country.

Nokia also hinted that it expected to announce some form of deal with Vodafone, but declined to elaborate. UK-based Vodafone owns majority stakes in dozens of operators globally. "The confidence about where that 5G uplift comes from is understanding the accelerated timelines operators now have," Suri told Reuters in an interview ahead of the Mobile World Congress taking place in Barcelona this week.

A year ago, operators were saying 5G rollouts would take off in earnest around the back end of 2019. Many cash-strapped phone service providers were then questioning whether there any were good business justifications for upgrading to 5G, he said. "Now, it has accelerated by almost a year, which is good news for the sector, because then they´ll be the next wave of investment coming. "Europe, however, so far lacks the catalysts for rapid, large-scale 5G rollouts, he added.

"Far and away, the U.S. and China activity will dwarf Europe (but) I think some 5G will be launched (in Europe) at some point in 2019," he said. Nokia said last month that its stepped-up capital spending to win future 5G upgrade deals would weigh on profitability this year.