Canada pledges $30 million of funding for Nokia
The Canadian government is providing Nokia (NOK) with $30 million in funding to support the company’s 5G research work, Reuters reported. The funding is expected to give Nokia greater financial flexibility as it works to develop its 5G business. Last year, Nokia secured 500-million-euro and 250-million-euro funding commitments from the European Investment Bank and the Nordic Investment Bank, respectively, to support its 5G research work in Europe.
Nokia has large operations in Canada and boasts a workforce of more than 2,000 people in the country, according to a CBC report. The funding from the Canadian government could see Nokia create close to 240 new jobs in the country.
Pursuit of 5G contracts
Nokia is in a race with Ericsson (ERIC) and other vendors to supply equipment and technology for 5G network buildout in Canada. Nokia has partnered with Canadian operators Bell and Shaw Communications on 5G network trials in recent years. Such partnerships can lead to contract wins.
Nokia has been reporting shrinking sales in recent years and is banking on 5G network buildout to stimulate demand for its network products. Nokia last year secured a $3.5 billion 5G-related deal with American operator T-Mobile (TMUS). It has also been selected alongside Ericsson and Samsung (SSNLF) to supply equipment for AT&T’s (T) 5G network development in the United States.
Nokia’s network revenue increased 1.0% year-over-year in the third quarter of 2018 after several quarters of consistent decline.