It was the best of Thursdays, it was the worst of Thursdays, depending on whether you work for Ericsson or Nokia.
Ericsson had a banner day last Thursday, announcing two significant industry partnerships at its analyst day in Boston, which led to a wave of positive media coverage, much of it from Fierce Network.
Nokia, on the other hand, spent the day mired in a global PR crisis. Both Bloomberg and the Financial Times published stories suggesting the company was preparing to fire its CEO, Pekka Lundmark. While Nokia claimed the reports were inaccurate, this episode was just the latest in a series of negative headlines focused on layoffs and financial troubles.
Service providers and investors reading those headlines would assume that Ericsson is at least a last mile ahead of Nokia in the critical area of private 5G, the focus of its event last week. But they’d be wrong. Excluding China, Nokia is actually the world leader in private 5G, with Ericsson trailing in second place.
This matters because Western communication vendors face an existential threat from Huawei. Private 5G represents the strongest defense against this danger, as it’s a key enabler of the cyber-digital revolution poised to transform global industrial society over the next decade.
Both Nokia and Ericsson, as leaders in 5G technology, are guaranteed a place in the ecosystem of companies building this new infrastructure. Ericsson excels at communicating this vision; Nokia does not.
Why? As with many national stereotypes, there’s a grain of truth in Finland’s reputation for stoicism and Sweden’s for diplomacy. This Swedish finesse was on full display last Thursday when Ericsson’s CTO, Erik Ekudden, charmed the 100 or so analysts in attendance, greeting most by name before announcing an exclusive application programming interface (API) venture with a dozen of the world’s largest telecom operators. Thirty minutes later, Ericsson did it again, unveiling a neutral host network deal supported by AT&T, T-Mobile and Verizon.
Tier 1 operators are notoriously difficult to unite, and Ericsson’s success in pulling off this double reflects its ability to parlay a trust-based relationship with its customers into the role of ombudsman for the wider communications industry — a remarkable feat.
Nokia, by contrast, has a leadership style that is perceived as more autocratic than diplomatic. In a fiercely competitive tech market, its grouchy approach isn’t doing the company any favors. Industry insiders suggest that Nokia may have lost out to Ericsson at AT&T because it didn’t put enough effort into cultivating a closer customer relationship (the “Blooming Onion” incident).
Nokia also says it had informed Bloomberg and the Financial Times that their stories were inaccurate before publication. But both outlets went ahead anyway. Would they have done so if Nokia had invested more time and energy in engaging with them?
The contrast in styles becomes even more pronounced in person. Visiting Ericsson’s headquarters in Sweden feels like being transported to Rivendell from The Lord of the Rings. Everyone is charismatic, highly intelligent, and genuinely delighted to see you (“Another slice of Prinsesstårta, Steve?”). The door at Torshamnsgatan 21 in Kista is always open.
Nokia is… different. In 2001, I visited Nokia’s headquarters in Espoo with two other founders of Light Reading. Despite traveling over 10,000 miles, Nokia’s executives decided they no longer wished to meet with us. So, they stayed upstairs in their offices, and we took the overnight ferry to Stockholm and met with Ericsson instead.
This pattern is likely to be repeated by customers and investors unless Nokia — a communications company — dramatically improves how it communicates its strategy to the industry.
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