The teaser for the Nokia Mobile World Congress 2016 media event promised the biggest thing you'll ever see.
Nokia's media event was not the biggest thing you'll ever see, but it painted the future of Nokia and it could be big. It is actually surprising how big Nokia is and still can be after Microsoft bought their mobile phone business. The mobile infrastructure business was the healthy part that Microsoft left over. Now Nokia is expanding again into the consumer world via IoT and 5G devices.
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Nokia outlined at the MWC 2016 media event on Sunday its approach as a renewed company focusing on next-generation 5G technology and the Internet of Things (IoT), targeting an addressable market opportunity that has nearly doubled in size following the acquisition of Alcatel-Lucent.
"We are planning to dramatically increase our investment in 5G this year and unleash the power of our massive innovation engine," Nokia President and CEO Rajeev Suri told a media and analyst briefing.
Suri announced a new 5G-ready AirScale radio access product to replace the Flexi base station. Nokia also announced the acquisition of Nakina, a Canadian software company that specializes in preventing, identifying and eliminating security threats. The Finish company launches a USD350 million IoT investment fund through Nokia's private venture firm, Nokia Growth Partners.
"We are already at the forefront of making 5G a reality and enabling massive capacity and massive connectivity - this is an integral part of our vision," Suri said.
"5G must happen fast because important IoT use cases demand it. If we know that 5G can help save lives, improve our environment, and make our lives better, we need to move faster, not slower, Suri said.
Nokia bought Alcatel-Lucent for $16.6 billion in an all stock deal in 2015.
"Progress with integrating Alcatel-Lucent is going smoothly and effectively, avoiding the organizational angst and infighting that have characterized earlier deals," Suri said.
He added that the combined company is targeting many different cross-selling opportunities and making joint bids to customers around the world. These opportunities are all part of the critical scope that Alcatel-Lucent has given Nokia, Suri said, in addition to greater innovation heft, scale and customer reach.
"When you put Nokia and Alcatel-Lucent together, suddenly Nokia is in a dramatically different position with an addressable market that balloons to EUR141 billion. What we will be able to offer our customers - and their customers - is, simply, unparalleled," said Suri.
Nokia and Alcatel-Lucent had combined net sales at the end of 2015 of EUR 26.6 billion, combined R&D spend of EUR 4.5 billion in 2015 with over 40 000 researchers and scientists, and combined net cash of EUR 10 billion. The official "day one" for joint Nokia and Alcatel-Lucent operations was on January 14, 2016.
Nokia's new 5G-ready AirScale product supports any technology, from 2G through LTE Advance Pro and 5G when it arrives. It also includes a new base station with future-ready baseband and next generation RF elements that will give customers a connectivity experience that exceeds all others. AirScale also uses 60% less energy than the Flexi.
The Nakina acquisition, expected to close in the first quarter 2016, is part of a Nokia priority to have the best network security in place to enable 5G and IoT. The acquisition is consistent with Nokia's long-stated view to do small, 'bolt on' deals that give Nokia new technology and unique capabilities.
The new IoT fund will invest in promising companies primarily around the Connected Enterprise, Consumer IoT, Connected Car, Digital Health as well as technologies with a focus on capabilities in big data and analytics. The fund will support Nokia in defining future business opportunities and the technical underpinnings for the rapidly growing IoT market.
Nokia has not announced any consumer devices at the MWC 2016. The company confirmed though future plans for new Nokia phones.
The Mobile World Congress 2016 will kick off officially on Monday, Feb. 22 in Barcelona. Samsung, LG, Sony, Nokia and others hosted MWC 2016 media events to reveal new devices including the Samsung Galaxy S7, LG G5 and Huawei Matebook.
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The GSMA organizes the MWC. The GSMA represents the interests of mobile operators worldwide, uniting nearly 800 operators with more than 250 companies in the broader mobile ecosystem, including handset and device makers, software companies, equipment providers and internet companies, as well as organizations in adjacent industry sectors. In 2015, Mobile World Congress hosted more than 93,000 mobile professionals from 200 countries.
Read the latest MWC 2016 news.