In a pivotal development for the global telecom industry, Finnish technology leader Nokia is in negotiations with Indian mobile operator Bharti Airtel for a multi-billion dollar contract to supply 5G telecom equipment as Airtel undertakes a significant network expansion.
This potential agreement follows a similar multi-billion dollar contract that Swedish telecom equipment provider Ericsson recently secured with Airtel, as reported by Reuters. India, now the world’s second-largest smartphone market, is experiencing substantial investments from telecom giants like Airtel, Reliance Jio, and Vodafone Idea to upgrade their networks to the latest 5G technology. This modernization push has become a vital revenue source for companies such as Nokia and Ericsson, especially following a dip in demand from US clients last year. However, the flow of orders from India has slowed significantly after a period of rapid growth in 2022.
The proposed deal with Airtel would feature Nokia’s advanced AirScale mobile radios, designed to enhance network performance and reduce energy consumption as they transition to 5G-Advanced technology. Sources close to the negotiations describe this potential contract as a “routine and ongoing arrangement” within the telecom sector. While Nokia has refrained from commenting, Airtel has yet to respond to inquiries.
Nokia is scheduled to release its third-quarter earnings report on Thursday. The company had previously reported an 18% drop in net sales during the second quarter, largely due to the decline in demand from India.
Adding another layer to the situation, Airtel is also in discussions with Samsung regarding the procurement of 5G equipment. While Samsung is actively trying to enhance its presence in the network equipment market, it has not yet caught up to Nokia and Ericsson. Samsung secured its first 5G contract with Airtel in 2022.
Additionally, India’s ban on using 5G equipment manufactured by Chinese tech giant Huawei has created significant opportunities for companies like Nokia, Ericsson, and Samsung to capture a larger share of the market.