Huawei, ZTE to Benefit from Nokia, Ericsson Exit from Russia Market

Huawei and ZTE finally have a chance to gain some business from Nokia and Ericsson. Due to the ongoing war between Russia and Ukraine, both Nokia and Ericsson have said they wouldn't supply any more gear to the operators in Russia. But the Chinese vendors don't need to be out here. Huawei and ZTE can be the partners for Russian operators in the absence of Nokia and Ericsson.

Highlights

  • Huawei and ZTE, two Chinese telecom gear vendors, have faced a lot of business challenges over the last two years because of their alleged ties with the Chinese government.
  • The Russian operators are likely not going to partner with Nokia and Ericsson for leaving them out in the middle of the war.
  • Chinese companies can participate in Russia's 5G communications networks if they decide to localise 5G production in accordance with the requirements of the Ministry of Industry and Trade.

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Huawei and ZTE, two Chinese telecom gear vendors, have faced a lot of business challenges over the last two years because of their alleged ties with the Chinese government. Both companies lost out on a major chunk of business from their core markets, such as the United States, India, and more. This paved way for the European gear vendors  - Nokia and Ericsson, to capture a larger market share in the markets where Chinese vendors were being ignored.

But now, Huawei and ZTE finally have a chance to gain some business from Nokia and Ericsson. Due to the ongoing war between Russia and Ukraine, both Nokia and Ericsson have said they wouldn't supply any more gear to the operators in Russia. But the Chinese vendors don't need to be out from Russia. Huawei and ZTE can be the partners for Russian operators in the absence of Nokia and Ericsson. It would most likely seal the deal for the long-term for the Chinese companies.

The Russian operators are likely not going to partner with Nokia and Ericsson for leaving them out in the middle of the war. In terms of numbers, there's no saying how big a win this would be for the Chinese players. But there's no doubt that Russia is a big market for the gear vendors, and Nokia and Ericsson would definitely feel the loss of the partnership with Russian operators on their balance sheets.

Regardless, the European vendors are covering ground fast in the markets where Chinese companies have been ousted from the business. Huawei and ZTE are both experienced players in the field and can easily take over to help out the Russian operators offer telecom services to their customers.

Earlier this year, Eduard Lysenko, Moscow City Government Minister, told TelecomTalk that Chinese companies could participate in Russia's 5G communications networks if they decide to localise 5G production in accordance with the requirements of the Ministry of Industry and Trade.

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