Nokia has suffered a big setback as the Finnish company lost out to Samsung Electronics as it pertains to the contract to supply new 5G equipment to Verizon in the United States.
Samsung with the $6.64 billion contract win, has reinforced its position as a major contender for the telecom gear market dominated by Nokia and its Nordic rival Ericsson after China’s Huawei was barred from bidding for 5G contracts in the United States.
The loss for Nokia follows the appointment in August, of its new Chief Executive Pekka Lundmark, but the source said negotiations were going on before he took charge.
A Nokia spokeswoman declined to comment on the loss.
She said, “We play a critical role in enabling Verizon’s 3G and 4G networks and continue to work with them to accelerate innovation in 5G. Adding: “They remain a top-three global customer.”
Major telecom firms such as Verizon uses several suppliers for building various parts of a network with radio contracts accounting for a big part of the spending.
Liberum analyst Janardan Menon said the contract loss could impact Nokia’s ability to invest in technology at the same rate at its competition, and rival Ericsson might have even increased its share at Verizon. Liberum has a “hold” rating on Nokia shares.
