Nokia reported stronger sales in North America in the first quarter, and in its networks business overall. However, the underlying profit of the company's networks business fell, and investors grew worried about drooping margins.
Verizon Communications will move to a software-centric network architecture to reduce costs and deliver new services to customers faster. The company today announced that Alcatel-Lucent, Cisco Systems, Ericsson, Juniper Networks and Nokia Networks will be its five initial software-defined network vendors.
Verizon is implementing software-defined networking throughout its networks to improve service timelines. For the company's wireline network, the initial focus will be on migrating legacy elements and functions onto software-based platforms.
Nokia's integration of Alcatel-Lucent following the proposed acquisition of its rival will be difficult and messy. Some significant rewards will take many years to achieve, if ever. However, very large research and development demands with economies of scale and scope in 4G, 5G and with fixed-mobile network convergence make this kind of transaction inevitable and indispensable.
Service providers' continual hesitation about how to implement software-defined networking (SDN) into their networks continued to be a drag on the service provider router and switch market as 2014 total revenue remained flat at $14.6 billion.
Is Nokia Networks' $16.6 billion acquisition of Alcatel-Lucent all about becoming a 5G powerhouse? Some analysts believe that's the case.
Now that the Q1 2015 earnings season is getting underway, FierceWireless is tracking the performance of large carriers and vendors, including T-Mobile US, Sprint, and Nokia. Special report
Speculation over Ericsson's future strategy has intensified following Nokia's announcement this week that it plans to buy Alcatel-Lucent, with some saying the Sweden-based vendor will be forced to expand its fixed-line business.
Nokia's $16.6 billion deal to acquire Alcatel-Lucent would bring together two large network vendors that have each gone through major mergers of their own that have been difficult, to say the least. Although the companies' leaders are defending the deal, some analysts are skeptical that the firms can pull off such a merger without major integration headaches.
Nokia has set off a new wave of consolidation in the telecom equipment market, reaching a deal to acquire Alcatel-Lucent for $16.6 billion. That move is now fueling speculation that Ericsson will make a similar move to round out its portfolio with more wireline capabilities by making a run for either Ciena, Infinera or Juniper.