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What’s in Fixed Networks Market for Nokia?

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Dec. 12 2018, Updated 10:30 a.m. ET

Fixed networks chief to be named later

Nokia (NOK) recently announced a corporate structure reorganization that saw it create a new division to house its mobile and fixed networks businesses. While Nokia immediately named company veteran Tommi Uitto to oversee the mobile networks business, it said its head of the fixed networks business would be named in due course. Leaving this post unfilled for now could show Nokia is taking its time to appoint the best leader for the business, and it could also suggest that the company is placing a lot of importance on the fixed networks business.

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5G technology to stimulate fixed networks market

There is a good reason Nokia may want to take its time to identify the right leader of its fixed networks business. The arrival of 5G is expected to stimulate the uptake of fixed broadband services, potentially enlarging the market for Nokia’s fixed network products as operators move to invest in fixed networks to capitalize on the demand.

According to market forecasting firm ABI Research, the global fixed wireless broadband market will generate $45.2 billion in service revenue by 2022, up from about $18 billion in 2018.

Operators show interest in fixed networks

Verizon (VZ) is one of the major providers of fixed wireless services in the United States. Its 5G services that launched in October are initially delivered through a fixed network. T-Mobile (TMUS) also has shown interest in entering the fixed wireless market to deliver broadband services to residential customers if it succeeds in its efforts to merge with its rival Sprint (S).

Interest in fixed networks technology in the United States has also come from cable provider Altice USA (ATUS), suggesting we could see further consolidation of fixed wireless providers in the country.

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