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Ericsson loses share, Nokia secures 5G win with China Mobile - FierceWireless

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China Mobile announced vendor awards for its latest round of 5G contracts, with Ericsson losing ground against a backdrop of geopolitical tensions and Nokia notably scoring a 5G RAN win in China.

Ericsson had already warned it was at risk of losing market share in China (as recently as last Friday during its second-quarter earnings presentation, where it told investors to plan for a significant reduction in both networks and digital services) after Sweden regulators decided to ban Chinese vendors from the country’s 5G networks over security concerns.  

RELATED: Ericsson’s China sales dive 60% in Q2

An announcement, first spotted by Reuters and issued by China Mobile after the evaluation of bids, showed winners of three tenders for 5G 700 MHz macro base stations.

Perhaps unsurprisingly, Chinese vendor Huawei was the biggest winner for all three tenders, awarded roughly 60% in each. ZTE, also a Chinese vendor, secured significant portions of the work, with awards across the three ranging from almost 29% to around 33%.

Nokia, which notably lost out previously on winning earlier 5G RAN deals in China (though did nab part of a 5G core contract), secured a 10.11% share for one of the recent three from China Mobile. Nokia has been working to execute a turnaround in its mobile networks business and reports second quarter earnings on July 29. The company declined to comment further on 5G awards from China Mobile.

RELATED: Nokia nabs 10% share of China Unicom 5G core contract

Ericsson, meanwhile, secured 9.58% of one 5G contract. In a press release the Swedish vendor said its award equates to about 2% of the market share. That figure is significantly lower than what Ericsson won in China’s 2.5 GHz competitive process, where it captured an 11% share.

Reuters, citing two sources familiar with the matter, pegged China Mobile’s total tender value at around $6 billion divided between the three portions. Nokia won 4% share overall, they added.  

RELATED: Ericsson wins 5G deals with Chinese operators, Nokia loses out

China Unicom and China Telecom have yet to disclose awards for this round of 5G contracts, but Ericsson is anticipating more of the same.  

“Given the context and based on the bidding rules, should Ericsson be awarded business in China Unicom and China Telecom we believe it would be in a similar range as with the China Mobile award,” Ericsson disclosed in its announcement.

The lower market share appears to be blowback against action by Sweden, which is Ericsson’s home base but represents a significantly smaller customer market for the network equipment supplier.

As Ericsson noted, the risk of lower market share in China “follows the decision by the Post and Telecommunication Authority (PTS) to exclude Chinese vendors’ products from the 5G auction in Sweden.”

RELATED: Ericsson is caught in cross-hairs between China, Sweden

With a large market like China at stake, Ericsson has been vocal about pro-competition. Earlier this year reports surfaced its CEO had lobbied a Swedish trade minister to reverse a ban on Huawei and ZTE from Sweden’s 5G rollout.

In the second quarter, Ericsson saw sales in mainland China drop 60% compared to Q2 2020, citing delayed 5G rollout.

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