It appears that Ericsson was successful in securing a portion of Chinese mobile operators’ latest 5G tender, while Nokia was left out.
Reuters, citing sources familiar with the matter, reported that Sweden’s Ericsson won a 3% share in China Telecom and China Unicom’s joint 5G radio access network (RAN) contract. Ericsson had already warned of expected market share loss in China, pointing to geopolitical tensions involving its home base of Sweden. In July the vendor won just 2% share for China Mobile and China Broadcasting Network’s 5G radio tender, down from 11% in 2020.
Nokia, meanwhile, had benefited in July when it garnered a reported 4% share – after not winning any 5G RAN deals in China the year before (it did nab some 5G core business). However, the Finnish vendor walked away empty handed in the latest round.
In a statement provided to FierceWireless, Nokia said: “We are aware of the results of the China Telecom and China Unicom joint 5G project tender. We respect the customers’ decision and remain committed to continuing to support China Telecom and China Unicom’s business in the future. We will continue to invest in our products and are ready to help our Chinese customers realize their 5G ambitions.”
The earlier 5G win in China was marked as a positive for the vendor as it works on a turnaround in its mobile networks business. Nokia had faced challenges with some of its 5G products and lost share with Verizon in the U.S. In Q2 results last week, Nokia noted it won back a customer in Canada and cited progress in China.
In addition to Ericsson, Chinese vendors Huawei and ZTE were among winning suppliers for China Telecom and China Unicom, as was Datang Telecom, but percentages weren’t disclosed, according to Reuters.
FierceWireless reached out to Ericsson, Huawei and the mobile carriers about China’s latest 5G contracts but had not heard back as of publication.
Huawei by and far had grabbed the highest share in China Mobile and CBN’s recent 5G radio contract awards, followed by ZTE.
According to a 2021 GSMA Intelligence report (PDF), mobile operators in the China region will invest nearly $210 billion in aggregate network capex (including RAN, core, and transport) over five years. A whopping 90% of that is going to 5G.
As of 2020, China Telecom and China Unicom had jointly built and are operating more than 320,000 5G base stations across China, the report stated. GSMA said it’s the largest commercial 5G network sharing agreement, covering more than 300 cities.
Last month, China’s Ministry of Industry and Information Technology cited that some 961,000 5G base stations had been built across the country, an increase from 819,000 in May. China expects to have more than 560 million 5G users by 2023.
The 5G RAN market overall is poised for growth, according to Dell’Oro Group. Demand for 5G new radio (NR) drove a surprising surge in the firm’s five-year RAN revenue forecast, which projects cumulative 5G RAN revenues to near $150 billion to $200 billion. The July report pegged total base station shipments as on track to exceed 30 million between 2020-2025.
Alongside infrastructure build out, as of 2020 China was one of the global leaders in 5G adoption.
The region added more than 200 million 5G connections last year, bringing its global share to 87%, according to the GSMA report. 5G adoption figures included mainland China, Hong Kong, Macao, and Taiwan. It anticipates that by 2025, 5G will account for 47% of total connections in China as subscriptions grow to 822 million.
In the U.S., GSMA expects 202 million 5G connections, accounting for 55% of all mobile by 2025. In other leading 5G markets like South Korea and Japan, 5G also will account for a higher share of connections (67% and 50%, respectively) than in China – but smaller market size means fewer 5G connections overall (101 million in Japan, 41 million in South Korea).