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Nokia, T-Mobile $3.5B 5G Deal Promises Payments, Commerce Changes

T-Mobile has signed a $3.5 billion deal with Finnish firm Nokia, which will provide the U.S.-based carrier with “end-to-end 5G technology” the companies said. The agreement, announced Monday (July 30), comes as 5G continues to gain importance in plans involving the Internet of Things and other forms of emerging connectivity.

Supporters of 5G say that the faster speed it promises, along with its connectivity capabilities and the long battery life it provides for sensors, will together promote payment- and commerce-related activities, virtual and augmented reality, autonomous driving, industrial automation, the further spread of Wi-Fi-enabled appliances, vehicles and other devices, and other tasks.

5G Financial Impact

T-Mobile reportedly anticipates that its customers in New York, Los Angeles, Dallas and Las Vegas will have access to 5G technology in early 2019. The deal also helps Nokia calm the nerves of investors concerned about the company’s recent results. The firm’s CEO, Rajeev Suri, predicts that increased operator spending on 5G will start offering significant financial benefits during the later parts of 2018.

“It’s our largest 5G deal to date, and, in fact, one of the largest deals Nokia’s ever signed,” Phil Twist, vice president for marketing at Nokia’s Mobile Networks unit, told a Bloomberg reporter. “This underlines and makes concrete that 5G is coming to the market.”

The Nokia-T-Mobile deal could also provide a spark that could help other players. “The network equipment business, which is led by three big players — Nokia, China’s Huawei, and Sweden’s Ericsson — has struggled with flagging growth since the current generation of 4G mobile equipment peaked in 2015,” Reuters said Monday.

5G Adopters

Both the United States and China have been seen by 5G experts as early adopters of the technology.

In fact, in early July, Nokia and Tencent, one of China’s leading providers of internet services, said they had inked an agreement to carry out joint research and development work to explore the potential of 5G for new applications. Tencent, which has 1.04 billion combined monthly active users on its WeChat and QQ platforms, aims to capitalize on the connectivity, increased speeds, capacity and reliability that 5G services will bring.

Europe, too, offers a view of one of the significant roles that 5G technology could play in the coming years. Regulators, automotive companies, wireless firms and others are hashing out the question of what standard the continent should support when it comes to connected cars and trucks.

The debate pits a forthcoming 5G wireless infrastructure called C-V2X against existing Wi-Fi technology that, somewhat confusingly, goes by the moniker ITS-G5. The question involves how connected cars communicate with outside networks, an area that touches multiple issues related to web-enabled driving — including safety, data collection and management, payment and commerce features, and the further spread of the Internet of Things.

The agreement calls for Nokia to “help build T-Mobile’s nationwide 5G network with 600 MHz and 28 GHz millimeter wave 5G capabilities compliant with 3GPP 5G New Radio (NR) standards,” the companies said. “T-Mobile will leverage multiple products across Nokia’s end-to-end 5G technology, software and services portfolio, including commercial AirScale radio platforms and cloud-native core, AirFrame hardware, CloudBand software, SON and 5G Acceleration Services.”

The deal foreshadows 5G development in a variety of areas.

“Nokia and T-Mobile will develop, test and launch the next generation of connectivity services that will cover a wide range of industries, including enterprise, smart cities, utilities, transportation, health, manufacturing, retail, agriculture and government agencies,” the companies said Monday.

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