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U.S. telecom giant AT&T and Finnish network equipment manufacturer Nokia have announced a new agreement to develop a fibre network in the United States, Nokia revealed on Tuesday.
This new deal comes in the wake of Nokia losing a major network contract with AT&T to Swedish competitor Ericsson. In December, AT&T selected Ericsson for a significant contract to build a telecom network expected to handle 70% of its wireless traffic in the U.S. by late 2026.
Despite this setback, Nokia is focusing on growth in the fibre sector following AT&Ts $14 billion, five-year deal with Ericsson. Although Nokia did not disclose the financial details of the new five-year fibre agreement, it termed the deal a "significant milestone" that will "boost broadband access for millions of users" in the U.S. The new network will support AT&Ts extensive fibre infrastructure, which reached 27.8 million locations as of the second quarter of 2024.
In July, Nokia reported a 32% drop in profit, but CEO Pekka Lundmark is optimistic about a rebound, projecting significant growth in net sales for the latter half of the year. Lundmark highlighted an improving fibre market in the U.S. and a $42 billion U.S. government initiative aimed at expanding high-speed broadband access.
The fibre deal with AT&T is compliant with the "Build America, Buy America" requirements, ensuring it meets U.S. government funding criteria. Additionally, Nokia announced in June its acquisition of U.S. optical networking firm Infinera for $2.3 billion, aiming to capitalize on the increasing investments in data centers driven by the rise of artificial intelligence. |
