The ‘new Nokia’ is here, and more mobile

• Opportunities in both advanced and emerging markets
• LTE improvements on the horizon for IoT vendors and telcos

 
NOKIA Corp is undergoing an evolution just like the networks it is providing, even as it hopes to wrap up its proposed megamerger with Franco-American vendor Alcatel-Lucent SA in an all-stock deal valued at US$16.6 billion.
 
The Finnish tech giant has restructured into five business groups: Mobile Networks Business; IP (Internet Protocol)/ Optical Business; Applications and Analytics; Fixed Networks; and Technologies.
 
Danial Mausoof, Nokia’s head of marketing and corporate affairs for Asia Pacific and Japan, when briefing the media in Singapore on this organisational structure recently, stressed that this is the new iteration of Nokia.
 
“Nokia as it looks tomorrow is this – we will have five business groups,” he said. “It’s not Nokia Siemens, it’s not Nokia Networks, it’s Nokia,” he said.
 
“We are going to get the scale that we wanted, and we have sized the business for mobile networks,” he added.
 
The Mobile Networks Business will be a heavy contributor to what the company is already doing in Asia today, according to Mausoof, and this will be further boosted by the IP/ Optical business which it is getting from Alcatel-Lucent.
 
“[This] is a very significant piece of how we want to deliver to customers today,” he said.
 
As for the Applications and Analytics business, Mausoof said that Nokia customers in Asia were increasingly talking about analytics and wanting to learn from innovators in the market, but also wondering how to make money from it.
 
The Fixed Networks business will come from the Alcatel-Lucent transaction, with Nokia devoting a business group to grow it. It deals mainly with fibre-optic and copper lines and home devices.
 
Finally, Nokia’s Technologies group remains the same, retaining its patent, technology and brand licensing functions, along with incubation and patent management.
 
Market outlook
 
Nokia shareholders have approved the Alcatel-Lucent acquisition. Nokia had first expected to complete the transaction within the first half of 2016, and is now pushing this forward to the first quarter of 2016, according to Mausoof (pic).
 
“The shares are up, there’s a large campaign to make sure we get to the 50% mark quickly,” he claimed.
 
There will be a team to steer the merged entity on its portfolio and products, according to Mausoof.
 
“Our commitment remains – this is about scale and scope,” he said. “We will make sure the right products and customers are given priority in terms of roadmaps and everything else.”
 
“We got ready timelines and strategic intent on how to push this forward,” he added.
 
And of course, the merger will strengthen Nokia’s market share.
 
“In Asia Pacific, we are leading in LTE (Long-Term Evolution) – when Alcatel-Lucent comes in, we will have combined leadership in a number of markets when it comes to LTE and mobile broadband,” Mausoof said, without disclosing actual figures.
 
“We are going to keep a focus on getting Alcatel-Lucent customers into our portfolio very quickly, and supporting them,” he added.
 
Telco diversity
 
The Asia Pacific market is different from any of the other markets, Mausoof acknowledged.
 
“You have a market like Myanmar, where two-and-a-half years ago, a SIM card cost US$1,200; to a market like South Korea, where the LTE penetration is at 80% – these are two ends of the spectrum,” he said.
 
“When you look at mobile operators, there are more than 80 different operators,” he added.
 
READ ALSO: StarHub, Nokia Networks boost 4G experience in Singapore with VoLTE deployment
 
And there is a lot of activity, from LTE auctions to new operators.
 
The ‘new’ Nokia is targeting both the advanced and emerging telecommunication markets. By its definition, advanced markets have 4G (Fourth Generation) networks in place, while emerging markets are moving to 4G.
 
The “exciting part” about 4G is the impact it has on lives, and the innovation and technology that come along with it, according to Mausoof.
 
“There is innovation where we are using buffalos and elephants to deliver sites in Myanmar – this is real and this is stuff we are doing to innovate and deliver our services,” he said.
 
While emerging markets are helping sustain Nokia’s business, the advanced markets are driving innovation, Mausoof declared, including in the Internet of Things (IoT) and Fifth Generation technology (5G).
 
Network evolution
 

 
The focus on networks over the last few years has been on mobile broadband. This will be no different for the revamped Nokia, but the company will also be expanding to two other areas where it is seeing growing demand, according to Harri Holma (pic above), Nokia Fellow of Technology and Innovation Research.
 
“[Mobile broadband] … was our focus when we started to work on the 4G radio, the epicentre for smartphones, tablets and laptops.
 
“[But] we want to also address the two other corners in network evolution,” he said.
 
One of these is ‘massive machine communication,’ which refers to IoT connectivity, or as Holma put it, “How do I make mobile networks more optimised to support connectivity for tens of billions of connected devices?”
 
“The third corner we want to address is ‘critical machine communications,’ referring to remote controls for public safety, autonomous cars, and in the extreme case, remote surgery,” he said.
 
In that third corner, Nokia will have to deliver extremely high reliability and low latency, according to Holma.
 
“These two corners can potentially provide more revenue to mobile operators,” he said.

There is also the next phase of 4G evolution, which is LTE-Advanced Pro.
 
“We started with LTE in 2009 with the first commercial network, and now most operators are on the second phase of LTE called LTE-Advanced,” Holma said.
 
“Now we are working on the third phase of LTE evolution called LTE-Advanced Pro – we believe that once all these phases are implemented, the radio capabilities will be massively better than basic LTE,” he added.
 
“It means 10 times higher data rates,10 times lower latency (which is quite important for car communications), and 10 times better coverage – which is actually quite important for some IoT devices which can be located in the basement,” he said.
 
IoT targets
 
This next phase should also improve the lifespan of IoT devices, lower their costs, and raise their capacities, according to Holma.
 
Implementing these improvements can enable new service capabilities, such as being able to provide 5G services on a 4G network, he added.
 
When it comes to IoT improvements, Nokia has set three targets.
 
“First is coverage – we want to make the pattern of the radio coverage 20db (decibels) better, which is a massive improvement in network coverage,” said Holma.
 
This would lead to higher reliability and better coverage, even in very deep urban locations, he argued. This in turn would make the installation of IoT devices simpler, “because you can count on the availability of coverage,” he said.
 
As for the lifespan of IoT devices, Nokia is aiming for a 10-year lifespan with just two AA batteries.
 
“This would be nice, because you would be able to deploy sensors and control units without worrying about needing to replace the batteries,” he said.
 
Finally, there is cost. Nokia is hoping to drive down the cost of chipsets by 85%.
 
All these will come from Nokia’s Narrow Band (NB) IoT efforts. The IoT does not require the same kind of connectivity and bandwidth as the mobile Internet in general, where resource-hungry devices such as smartphones and tablets play.
 
With NB IoT solutions, “the data and deployments will be much lower, where data speeds of 100Kbps to 200Kbps are enough for many of these devices,” Holma said.
 
“The design is optimised for one antenna, and radio frequency filtering will be simplified,” he added.
 
This will be backward-compatible, so mobile operators would be able to deploy such capability via software upgrades to their LTE networks, according to Holma.
 
“The overall trend is there are new use cases that are starting to happen on top of mobile networks,” he said.
 
“Mobile networks will actually become the mainstream connectivity solution not only for smartphones, but also for the IoT and public safety,” he added.
 
The data crunch
 
As the world moves towards needing more data, the bandwidth on existing frequencies will be increasingly taxed, and Nokia is looking at solutions to provide more capacity and spectrum, according to Holma.
 
With these solutions, mobile operators would be able to use both licensed and unlicensed frequencies.
 
“This means that operators will be able to use LTE on licensed and unlicensed frequencies combined together, allowing devices to received data on licensed and unlicensed frequencies,” he said.
 
That is the most efficient way of offloading data to unlicensed frequencies, according to Holma. Another solution would be to aggregate LTE and WiFi technology.
 
“This means one device can receive data on licenced frequencies, and on unlicensed frequencies using WiFi,” Holma said.
 
“This will give access to more bandwidth, which means higher data rates and more capacity,” he added.
 
Security critical
 
As mobile networks become more critical for the IoT and public safety, the quality and security of networks become even more important.
 
“Nokia is addressing security as part of the evolution to 5G,” Holma said.
 
“What we are doing is working with standardised data to make sure we have the tools and capabilities to provide security,” he added.
 
Nokia currently has a security centre in Berlin that looks into future needs, according to Holma.
 
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