Nokia's Kyndryl partnership could leave telcos out in the cold

Finnish kit maker Nokia and IBM's former IT infrastructure arm Kyndryl have teamed up to go after the private networking and edge computing markets.

Nick Wood

February 17, 2022

3 Min Read
Nokia's Kyndryl partnership could leave telcos out in the cold
The fog and edge cloud computing concept

Finnish kit maker Nokia and IBM’s former IT infrastructure arm Kyndryl have teamed up to go after the private networking and edge computing markets.

The two companies on Thursday announced a global deal that brings together Nokia’s Digital Automation Cloud (DAC) – its private cellular networking and edge compute platform – and Kyndryl’s portfolio of consulting, design, implementation and managed services.

The partners have already made a marquee signing in the form of US chemical giant Dow, which has deployed private LTE and 5G, as well as several proof-of-concept (PoC) applications spanning worker safety and collaboration, asset tracking and various other industry 4.0 use cases. Dow plans to use what it has learned as a blueprint for rolling out private cellular networking across its sites worldwide.

“By collaborating with Nokia, we’re taking another step forward in helping our customers unlock the power of LTE and 5G through a secure, private environment that helps them deliver tailored enterprise-grade edge solutions that drive new value for their bottom lines and next-gen customer experiences,” said Paul Savill, global practice leader of network and edge computing for Kyndryl, in a statement.

“By combining Kyndryl’s world-class services expertise and global reach with Nokia’s mission-critical, industry-leading private wireless and industrial edge computing solutions, we will enable even more organisations to transform their operations, accelerate their digitalisation journey and reap the benefits of Industry 4.0,” added Chris Johnson, head of Nokia’s global enterprise division.

As partners, Nokia and Kyndryl have also agreed to co-develop new solutions for a whole host of different technology categories, including edge cloud, IP networking, optics, fixed access, 4G and 5G core, and network operations.

Aligning one of the big three cellular vendors with one of the world’s largest IT companies raises questions about where mobile operators fit into the private networking and edge compute value chain.

Operators of course hold spectrum and control access to it, but as we all know, there is only so much they can charge for that access. It’s a well-worn argument that to derive greater value from that spectrum, operators need to claw their way up the value chain and establish broader and deeper relationships with their customers.

An IT giant like Kyndryl, which was spun off from IBM last year, already has that relationship with enterprises. Its 4,000-strong customer base, spread across 60 countries, includes 75 of the Fortune 100. Now it is working with Nokia to marry the two worlds of IT and telecoms on behalf of those customers. While there will be a supporting role for operators to play when it comes to deploying private mobile networks and edge connectivity, it is more likely to be Kyndryl and Nokia, not an operator, that plays the starring role as far as end users are concerned. That might be a sufficient enough leg up the value chain for some operators, but others might feel left out.

In some cases though, mobile operators could be overlooked entirely. Take Amazon Web Services (AWS), for example. Late last year, it unveiled AWS Private 5G, which aims to make as extensive use as possible of shared cellular spectrum, rather than licensed spectrum. Where does that leave operators?

Meanwhile, according to a survey published separately by Nokia on Thursday, when it comes to billing, operators are taking their sweet time to overhaul their BSS to enable new 5G services, like network slicing, for example. This and the Nokia-Kyndryl tie-up should signal a warning to operators that the window of opportunity to become a trusted digital transformation partner is closing.

About the Author(s)

Nick Wood

Nick is a freelancer who has covered the global telecoms industry for more than 15 years. Areas of expertise include operator strategies; M&As; and emerging technologies, among others. As a freelancer, Nick has contributed news and features for many well-known industry publications. Before that, he wrote daily news and regular features as deputy editor of Total Telecom. He has a first-class honours degree in journalism from the University of Westminster.

Get the latest news straight to your inbox.
Register for the newsletter here.

You May Also Like