COVID-19 boosts Nokia’s broadband business

Bengaluru

Many customers had planned to grow their network by 30 percent to 40 percent over the next few years assuming a similar growth in traffic, but COVID-19 brought in that traffic growth overnight, said Sandy Motley, Nokia’s President of Fixed Networks.

“Customers will need to accelerate the growth that they had planned in the future, and we’ve seen customers already talking to us about that,” she said, adding orders for fixed networks were up 22 percent in the first quarter.

Nokia boosted its fixed-line networks business with the 2016 purchase of Alcatel-Lucent in a 15.6 billion-euro ($17 billion) deal. The unit’s revenue fell 18 pc year-on-year in the first quarter and 5 pc between 2018 and 2019 but Motley said the decline was due to business cycles.

“We have seen some upgrades from our customers... but we think a lot of this drive will be more medium term and long term,” Motley said.

The European Commission has proposed by 2025 all European households, rural or urban, should have access to networks offering download speeds of at least 100 MBps.

In 2019, Nokia’s Fixed Access business amounted to around 10 pc of the company’s main networks business sales, with Mobile Access accounting for 64 pc.