On Thursday, Nokia partnered with Alphabet’s Google Cloud unit to build a 5G core network infrastructure and support business customers to offer services such as smart retail and automated manufacturing.
Cloud computing units of giant technology firms such as Amazon and Microsoft are also tying up with telecoms vendors ahead of the extension of 5G infrastructure to corner a share in new businesses the new technology might enable.
While Nokia will bring its 5G expertise, Google Cloud will help as the platform for launching applications and assist customers in building an ecosystem of services.
Amol Phadke, Managing Director at Google Cloud told Reuters that “We will start to see some of these things to get in the live environment by end of this year.”
He added that the timeline for the availability of the services would depend on telecom operators.
Pekka Lundmark, Nokia’s chief executive, overhauled the Finnish company’s 5G strategy in October last year.
Announcing a new strategy under which the company will have four business groups, Lundmark said Nokia would “do whatever it takes” to take the lead in 5G where it lags Swedish rival Ericsson and Chinese group Huawei.
Lundmark said in a statement that “We expect to stabilize our financial performance in 2021 and deliver progressive improvement towards our long-term goal after that,”
The company also cut its 2020 operating margin forecast to 9 percent from 9.5 percent and for 2021 expects an operating margin of 7-10 percent.
JP Morgan analysts said higher research and development spending was likely to drive the margins lower than the consensus expectations of 10.9 percent for 2021.
He added that “Nokia is likely to find raising operating margins challenging due to its relatively low market share, Liberum analysts said in a note.”