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Nokia (NOK) Spurs AI-Driven Solutions Across CMCC's Network

Zacks Equity Research
·4-min read

Nokia Corporation NOK recently concluded major AI-driven radio access network (RAN) trials in collaboration with a mobile network operator — China Mobile (“CMCC”). The pilot was conducted over CMCC’s live 4G and 5G networks. The successful completion marks a significant milestone for Nokia, particularly at a time when service providers are transitioning toward a more sustainable and digital inclusive ecosystem with avant-garde 5G technologies for automated operations.

As part of the partnership, CMCC capitalized on the Finnish equipment vendor’s RAN Intelligent Controller (RIC) along with its AirFrame Open Edge server platform to realize the concept of its “i-wireless-intelligent and simplicity 5G network”. These solutions will act as a doorway to a range of real-time data-driven network enhancements on the back of artificial intelligence (AI) and machine learning (ML) applications.

Nokia is focused on four strategic priorities. The first is leading in high-performance end-to-end networks with its service provider customers. The second priority is to expand network sales to select vertical markets, specifically energy, transportation and webscale players. Building a strong standalone software business is the third priority. The last is creating new business and licensing opportunities in the consumer ecosystem. Markedly, Nokia is committed to exploring the potential benefits of an evolved ecosystem, and Open RAN serves the purpose with strong network performance and security.

Open RAN primarily strives to establish seamless interoperability between different vendors over a set of defined interfaces. Per the trial, CMCC leveraged Nokia’s near-real-time RIC platform to automate its network. This innovative virtualized 5G optimization solution adds programmability with AI/ML technology within the RAN and spurs optimization through policy-driven closed loop automation. It was paired with Nokia AirFrame open edge server, which is a data center solution, designed for edge and far-edge cloud deployments. To add to that, it is considered as a vital element to boost the implementation of Cloud RAN backed by a robust 5G RAN architecture.

Notably, the companies exhibited two trials in the cities of Shanghai and Taiyuan. The first one was related to predicting bandwidth requirements and the second being a network anomaly detection test. Further, the trial that analyzed network automation across more than 10,000 cells was designed by China Mobile Research Institute and Nokia. In fact, these intelligent applications are expected to reduce operational overheads by more than 70% on the virtue of negligible human interference. This, in turn, will support CMCC’s transformation to 5G by providing a host of capabilities for the digital era.

Nokia is well positioned for the ongoing technology cycle, given the strength of its end-to-end portfolio. The company is driving the transition of global enterprises into smart virtual networks by creating a single network for all services. With more than 100 commercial 5G contracts globally, it remains focused on building a robust scalable software business and expanding it to structurally attractive enterprise adjacencies. Accelerated strategy execution, sharpened customer focus and reduced long-term costs are expected to position it as a global leader in the delivery of end-to-end 5G solutions.

Some other players in the industry are Comtech Telecommunications Corp. CMTL, Qualcomm Incorporated QCOM and Sonim Technologies, Inc. SONM.

Comtech delivered a trailing four-quarter positive earnings surprise of 2%, on average.

Qualcomm delivered a trailing four-quarter positive earnings surprise of 17.3%, on average.

Sonim delivered a trailing four-quarter positive earnings surprise of 2.2%, on average.

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