Nokia looks to tackle Huawei in its own backyard

Nokia has continued its quest of recovery by creating a new joint venture with China Huaxin, acting as the company’s major presence in the country.

The move will see Nokia own 50% plus one share of Nokia Shanghai Bell, with China Huaxin owning the remainder, and will become the exclusive platform in China for areas such as IP routing, optical, fixed and next-generation 5G. It would seem Nokia is tired of Huawei constantly going on the offensive, stealing market share all over the world, and it is taking the fight to the market leader on its home turf.

“Today’s agreement is historic for Nokia and for China, marking the next step of our decades-long commitment to the country and underscoring China’s leading role in developing next-generation communication technologies,” said Rajeev Suri, CEO of Nokia.

“Nokia Shanghai Bell will enhance our ability to innovate, helping us strengthen ties with communication service providers and expand to new, fast-growing sectors in need of high-performing networks.”

If there were any worries about Nokia going down without a fight, this is certainly a vote in favour of the Finn’s. Nokia Shanghai Bell will have 16,000 personnel, including 10,000 researchers, working across six R&D sites in China, Nokia claims. Taking on Huawei in China is a brave move, but the team won’t be leaving any unanswered questions; it seems to be an all-or-nothing approach here.

“We are fully confident in the new joint venture’s success during the industry transformation brought by the new technologies like 5G and IoT,” said Yuan Xin, GM of China Huaxin.

“The successful combination globally and in China brings together the leading E2E network technologies and most powerful innovation engines from both sides. We’re excited to work with Nokia to establish a future-oriented innovative technology company, with a win-win cooperative model for the bigger success in the new era.”

While Ericsson sometimes seems to be shrinking with a whimper, at least Nokia is showing it still has a couple of haymakers hidden in the armoury.