Nokia promises 1G per user a day by 2020

MANILA, Philippines - After completing the process of shedding its devices and services business to Microsoft for $7.5 billion in April this year, former handsets giant Nokia lost nary a step in firming up its revenue streams and reimagining a future without its once omnipotent business unit.

The board of what is now called simply as Nokia or Nokia Networks appointed a new president and CEO (Rajeev Suri), and conveyed a new vision to be a “leader in technologies important in a connected world” — expressed via three businesses.

Speaking before the media, Nokia Networks country director and head of Asia South John Lancaster-Lennox underscores that the company has “a very strong portfolio in tech, mapping, and networks areas,” and that these are “obviously exciting times for Nokia.”

“It was clearly the right decision to make,” he comments on the handsets portfolio sale. Nokia had infamously been hemorrhaging there in the face of increased competition from giants that were not even on the radar during the company’s heyday.

“It shows we are prepared to evolve not just to survive but to thrive,” continues Lancaster-Lennox, “and that drew very positive reaction from our markets.”

Indeed, the reconfiguration of Nokia into three major business units is sweetened by the fact that these all enjoy leadership positions today. Its networks portfolio serves more than 90 of the world’s 100 largest operators, is the prime mover in mobile broadband, and is leading the way in “virtualization and cloud technologies.”

Nokia’s mapping effort, called “Here,” is a leading force in location cloud; a map content provider for automobile navigation systems in some 10 million vehicles; and a neutral provider of content, platform, and services. As far as technologies go, Nokia boasts an IPR patents trophy case of 44,000 — double the number of its nearest rival.

The forward push continues as the Espoo, Finland-headquartered multinational is keenly focused on its ambitious “Vision 2020.” According to its corporate website, Nokia is “implementing a hands-on innovation approach to enable mobile broadband networks to profitably deliver one gigabyte of personalized data per user per day by 2020.”

Realizing this goal entails working with operators not just to overcome but better address the needs of “extreme traffic growth,” through the simplification of network operations and by pushing the technological envelope to enable greater bandwidth, courtesy of its end-to-end mobile broadband expertise.

This is important because Nokia’s own acquisition and retention study report — which surveyed close to 12,000 customers in 11 countries — revealed that while network and service quality remains a significant reason for choosing a particular operator, the biggest concern is still cost and billing across the range of markets from emerging to in-transition to mature.

Asked by The STAR in a subsequent exclusive interview if the 1G dream is reasonable even in the Philippines where much leaves to be desired in terms of bandwidth and connection, Lancaster-Lennox avers: “I believe so. The main investment that the operators need to make, and that they are making, is in their transmission network.”

Operators such as Smart and Globe, shares the Nokia executive, are investing in base stations, software, core and transmission networks.

“Transmission is the main bottleneck here (brought on by) the lack of fiber,” he observes. “The reason it has taken off so much in Korea is that every single station, every single site has fiber to it pretty much. So you get this wonderful speed… that’s what’s missing here.

“They need to get their transmission network sorted now. For 3G, a good microwave transmission with a combination of fiber gives a pretty sensible and decent network. With 4G, the need to have more and higher penetration of fiber is there. Once you’ve got the fiber there, it’s much easier to deliver what’s needed.”

That would include next-generation 5G — the parameters of which have not been precisely hammered down — that Nokia is heavily involved in conceiving. The Nokia executive predicts that a workable concept would be done by 2016 or 2017, and a rollout by 2020.

Lancaster-Lennox agrees with the observation that there are unique hurdles keeping the country from an ideal situation — such as the overwhelming number of islands. “The laying of fiber has a completely different level of complexity under the sea. Joining islands together does take more effort — and investment,” he says.

Still, there is confidence that Filipinos will not be connection-starved in the future. It is incumbent upon industry players to provide greater bandwidth — especially in the face of key trends shaping the business.

For instance, there has a massive growth in mobile data and traffic. “Certain networks have seen four-fold growth in data,” reveals Lancaster-Lennox. New industry players and alignments have kept the sector dynamic and full of possibilities. Another is that we are moving from mere data analytics to more cognitive, intuitive networks that speed up processes. Whether we like it or not, the age of big data is here.

“We are pushing the envelope with our big data management,” Lancaster-Lennox avers. The bottom line, he adds, is to work toward more efficient use of network capacity. That’s what people want, and that’s what they should get.

“The global spend on networks has been flat for a few years, it’s not going to massively increase,” the executive admits. ”We have to cut our cloth accordingly to make sure we can deliver the solutions needed as efficiently as possible. Hence, the need for the reinvention that we have gone through over the last couple of years. We have become a much more efficient company with a much better cost base, and we are able to offer exceptionally good value in the market… we have to continue doing that… operators won’t pay us more because people won’t pay them more.”

Nokia today thus continues to buckle down for work despite rapidly changing in concert with a rapidly changing world. The fiat is the same. “We need make sure we have the best products in the market and execution… growing from strength to strength,” concludes Lancaster-Lennox.