Ericsson, Nokia Miss China Mobile 5G Tender worth $1.16 Bn

China Mobile has awarded a network contract worth CNY7.5 billion ($1.16 billion) to Huawei and ZTE, the country’s major telecom gear vendors, leaving out Ericsson and Nokia.

China Mobile Freezes out Nokia, Ericsson from its 5G

Both of the European vendors had recently won slices of major deals with domestic operators. C114.net reported that Huawei and ZTE had submitted bids to China Mobile worth CNY7.49 billion and CNY7.46 billion, respectively. However, it also suggested that those two might have been the only ones to submit official bids with China Mobile.

Neither China Mobile, nor any news outlet disclosed the full size of the converged 4G/5G core network contract.

Notably, Huawei, once the world's largest telecom gear maker, has seen itself frozen out from countries across the world over allegations of connections with the CCP and the PLA. As such, the move by China's largest operator doesn't seem surprising.

However, it would nevertheless have disappointed the European vendors, after they had started gaining ground. In July, Nokia Shanghai Bell secured a 10.1% in a 5G RAN contract from China Mobile. At the same time, the Chinese telco awarded a 9.7% share in the same. In August, Ericsson won about a 3% share of a joint 5G RAN tender from China Telecom and China Unicom; the telcos left Nokia out in this one, however.

Ericsson had been already preparing, and facing reducing market share; China and Sweden are not on the best of terms right now. However, Nokia was hoping that its fortunes might change; CEO Pekka Lundmark had also committed to bidding on the second round of network tenders. Those two tenders, though, went mostly to Huawei and ZTE.

The geopolitical reasons behind the latest development have been well-documented. After US sanctions on Huawei, and the very public affair with the Huawei CFO, who was just recently released from her house arrest in Canada, Chinese gear vendors have been losing market across the world. As a retaliatory measure, China, the largest telecom market in the world, has been working to reduce "western influence" in its telecom networks.