Nokia Corporation NOK recently secured a prime contract from Telefónica, S.A.’s TEF U.K. subsidiary to support the latter’s existing network connectivity as it transitions to cloud architecture. The contract for undisclosed amount also aims to facilitate rendering reliable 5G services to more than 34.1 million customers of the carrier.
In particular, Nokia will deploy its cloud-native Subscriber Data Management (SDM) software to centralize user data into a single, robust and secure User Data Repository. This central register with single point of provisioning will save operating costs and significantly speed up time to market while offering unrivalled scaling capabilities to meet the most stringent requirements. Notably, the SDM software serves approximately 4.8 billion global subscribers and devices, streamlining operations and optimizing services to improve efficiency levels.
Per the deal, Nokia will support subscriber data management for the carrier’s 3G, 4G, 5G networks, along with Voice over LTE (VoLTE), Voice over WiFi (VoWiFi) and Voice over 5G (Vo5G) services. In addition, it will deploy Shared Data Layer, a cloud-native database accessible via industry standard protocols, to enable an open ecosystem and the integration of third party applications.
A few days back, Telefonica inked agreements with Nordic firms – Nokia and Ericsson ERIC – to provide essential telecommunications equipment for the nationwide deployment in Spain. Markedly, Nokia has been Telefonica’s preferred vendor since 2018 and has supported its 5G strategy with trials in the historical city of Segovia in central Spain. To its credit, Nokia is reportedly the only vendor to supply 5G radio technology to all of Telefonica’s 5G operations across Europe.
Nokia is well positioned for the ongoing technology cycle given the strength of its end-to-end portfolio. The company’s deal win rate is encouraging with notable successes in the key 5G markets of the United States and China. 5G revenues are expected to grow in 2020, driven by its commercial wins. Its installed base of high-capacity AirScale product, which enables customers to quickly upgrade to 5G, is growing fast. The company is driving the transition of global enterprises into smart virtual networks by creating a single network for all services, converging mobile and fixed broadband, IP routing and optical networks with the software and services to manage them. Leveraging state-of-the-art technology, Nokia is transforming the way people and things communicate and connect with each other. These include seamless transition to 5G technology, ultra broadband access, IP and Software Defined Networking, cloud applications and Internet of Things.
Shares of the company have gained 24% in the past six months compared with the industry rally of 44.3%.
To strengthen its position in the market, Nokia facilitates its customers to move away from an economy-of-scale network operating model to demand-driven operations by offering easy programmability and flexible automation needed to support dynamic operations, reduce complexity and improve efficiency. The company seeks to expand its business into targeted, high-growth and high-margin vertical markets to address growth opportunities beyond its traditional primary markets.
Nokia currently has a Zacks Rank #3 (Hold). A better-ranked stock in the industry is Viasat Inc. VSAT, sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Viasat has a long-term earnings growth expectation of 18.9%. It delivered a positive earnings surprise of 361.3%, on average, in the trailing four quarters.
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