Some on Wall Street think Nokia is a disruptor in disguise, reinventing itself quietly to seize control of networking through 5G. I don’t agree with the article’s like that “5G is the Next Industrial Revolution” (hey, this is media, so do we expect hype or what?) but I do think that the article makes some interesting points.
Network transformation requires money to fund the transforming, period. That’s the irreducible requirement, more so than any specific technology shift or service target. In fact, those things are relevant only to the extent that they contribute to the “money”. What makes 5G important isn’t that it’s revolutionary in itself, but that it’s a funded step on the way to a different network vision. The revolution isn’t 5G, but what 5G could do to change how we build network services. Emphasis on the “could”.
I’ve blogged about Nokia and 5G before (HERE and HERE), particularly with regard to its fairly aggressive O-RAN commitment. I believe that O-RAN is the key to getting a new open-model architecture for network infrastructure into play, and that it’s also the key to starting a 5G-driven transformation of network-building. But if 5G is only a stepping-stone, then Nokia needs to support the pedestal it leads to and not just the step. Do they know that, and can they do it?
If we had ubiquitous 5G, would it get used in IoT and other applications? Surely, providing those applications could create a service model that delivered that irreducible “money” element. 5G does not remove all the key barriers to any of these applications, and for most it doesn’t remove any barriers at all. Yes, enormous-scale public-sensor IoT (for example) could demand a different mobile technology to support it, but we don’t have that and we don’t have clear signs that we’re even headed there. That’s the challenge that Nokia faces for it to be able to exploit whatever the “Next Industrial Revolution” really is.
If that next industrial revolution isn’t driven by 5G, it’s largely because it’s not driven by connectivity alone. Applications are what create value, and delivering that value is the network’s mission. Does Nokia realize that, and have they taken steps to be an application-value player? Indications are there, but not prominent.
Nokia’s website has two “solutions” categories that could validate their effort in being a player in the creation of network-transforming applications, both under the main category of IoT. The first is IoT Analytics and the second IoT Platforms. Unfortunately, IoT Platforms is all about device and connection management and not about hosting IoT applications. IoT Analytics does have useful capabilities in event correlation, analysis, and business responses. Since the article I referenced at the start of this blog is really largely about IoT, you could take Nokia’s IoT analytics as a step toward realizing the “disruptor” claim.
The problem is that every public cloud provider offers the same sort of toolkit for IoT analytics, and there’s a substantial inventory of open-source and proprietary software that does the same thing. If you explore Nokia’s IoT strategy, it seems to me that it’s aimed less at the enterprises and more at service providers who want to serve those enterprises. Those service providers would still need to frame a service offering that included Nokia’s IoT elements, but couldn’t likely be limited to them because of competition from public cloud and open source. They’d also have to overcome their obvious reluctance to step beyond connection services, and that might be the tallest order of all.
There’s also a bit of a Catch-22 with 5G and IoT and other edge applications. The applications themselves would surely roll out faster if they weren’t 5G-specific, since connectivity can be provided by LTE or even WiFi in many cases. The problem for Nokia is that a decision to accelerate the applications by making them more generally dependent on connectivity would then mean they wouldn’t pull through Nokia’s 5G story. That could mean a lot of Nokia’s disruptor potential disruptor status might be threatened. It’s going to be interesting to see how Nokia balances this over the rest of 2021 and into next year.