China Mobile awards some 5G contracts to Ericsson and Nokia

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(Image credit: BigStock/TK Kurikawa)

China’s largest telecommunications network operator announced Sunday it had awarded its first round of 5G network equipment contracts worth around $2 billion to four suppliers from different countries, including European company Ericsson and Nokia.

Chinese telecom equipment giant Huawei was awarded the bulk of the tender. It will provide 588 units of Mobility Management Entity (MME) and System Architecture Evolution (SAE) telecom equipment, the core network product of the next generation of wireless network, accounting for 51% of the total tender.

Swedish company Ericsson and Finnish company Nokia are the second- and third-largest 5G equipment providers for China Mobile. Ericsson will provide 384 units of MME/SAE equipment, and Nokia will offer 116 units, followed by Chinese company ZTE with 43 units.

China Mobile, also the world’s largest telecom operator by mobile subscribers, is starting to build its 5G network after acquiring on June 6 a 5G commercial use license from the Chinese Ministry of Industry and Information Technology.

Ericsson and Nokia are expected to gain less 5G market share than they held during the 4G roll out because China’s three major state-owned telecom companies—China Mobile, China Unicom, and China Telecom—may have to support Huawei following a global backlash led by the US government.

An analyst quoted by China Daily, a state-run English-language newspaper, said the significant share of Ericsson and Nokia in China Mobile’s 5G equipment tender highlights that China delivers its promises of sticking to international cooperation.

A commentary (in Chinese) published Monday by Beijing Youth Daily, the official newspaper of the Communist Youth League committee in Beijing, said the tender had proven the Chinese government and Chinese telecom operators weren’t defensive about Ericsson and Nokia just because they were foreign companies. “Instead, the Chinese market has given them opportunities to participate in the country’s 5G network rollout fairly,” the commentary said.

Huawei said in a statement that the company’s 5G equipment had reached the standard of commercial use, and the company would “spare no effort” to back Chinese telecom operators in their 5G rollouts.