Finnish telecom giant hopes to help firms speed up industrial digitalization

Finnish telecom company Nokia Corp will step up its push to tap into enterprise business opportunities in China, with the aim of helping local companies accelerate industrial digitalization, a senior executive said.

The plan comes after Nokia's global net sales for its enterprise business grew 62 percent year-on-year in the first quarter, by leveraging digital technologies to help a wide range of sectors boost efficiency.

Chris Johnson, senior vice-president and global head of enterprise at Nokia, said enterprise business is really an important harbinger of things to come, because "we've come to the end of the sort of 5G spending cycle, and so to grow the business, enterprise (market) is the answer".

"The partnership in China is super important. We've got a very historic business here, going back 10 years or more, especially with the rail business, with the State Grid energy company and the smaller customers … China has really big growth potential for us," Johnson said.

He said Nokia installed a data center in China in the second half of last year, which is the center of its new product — Nokia Digital Automated Cloud. Based on the 5G network, it can work for industry sites, container ports, terminals, schools, hospitals, factories and warehouses.

"This is a big opportunity for us in China, and we have a big target for the China market," Johnson said, without disclosing details.

The executive added that Nokia will focus on international customers that have industrial facilities in China. And once it has a good reputation, Nokia can use those references to gain more local customers.

He said Nokia Shanghai Bell, a joint venture of Nokia Corp and State-owned investment firm China Huaxin, is Nokia's exclusive platform in China, with strong local and global resources.

"The industry 4.0 opportunity is much bigger than the internet. The internet was great and we could do our shopping on the internet and it created a new economy. But industry 4.0 is about making industry 10 to 20 percent more productive. This is huge economic growth."

He added that mines, container ports, chemical processing facilities, warehouses and factories have big potential for digital transformation. "It is very easy to see how a 4G or 5G network was better than WiFi (in mines). You could automate all the machines with all of the diggers around, taking human beings out of the dangerous jobs, making it a safer environment, 24-7 nonstop working."

Wang Zhiqin, vice-president of the China Academy of Information and Communications Technology, a government think tank, said previously that China's digital economy has been chiefly driven by consumer-oriented internet applications like e-commerce.

Now, enterprise or business-oriented applications are playing a significantly bigger role, showing that improvements have been made in the digital economic structure, Wang said.

US market research company International Data Corp forecast that by 2024, 51 percent of global IT budgets will go to digital innovation and digital transformation, while the number in China is estimated to be above 70 percent.

Kitty Fok, managing director of IDC China, said China's digital transformation is mainly focused on the consumer level, such as mobile payments, e-commerce and video-streaming platforms. This means there is still huge potential for the country's companies to accomplish their digital upgrade as a whole.