- Russian telecom users expected slower data, more interrupted calls, longer outage resources
- This content was produced in Russia, where the law restricts coverage of Russian military operations in Ukraine
STOCKHOLM/MOSCOW, Dec. 21 (Reuters) – When telecom manufacturer Nokia (NOKIA.HE) and Ericson (ERICb.ST) Leaving Russia at the end of the year, their departure could steadily cripple the country’s mobile networks in the long run, causing a deterioration in communications for ordinary Russians.
Five senior telecom executives and other industry sources said Russian mobile phone users are likely to experience slower downloads and uploads, more dropped calls, calls that fail to connect and longer outages as operators lose the ability to upgrade or patch software, and compete to reduce stocks of spare parts.
Ericsson and Nokia, which together account for a large share of the telecom equipment market and nearly 50% of base stations in Russia, make everything from the telecom antennas to the hardware that connects optical fibers to digital signals.
They also provide crucial software that allows different parts of the network to work together.
“We are working towards the end of the year and then all exemptions (from sanctions) expire,” Ericsson chief financial officer Carl Mellander told Reuters. Ericsson received exemptions from sanctions from the Swedish authorities.
Nokia CEO Pekka Lundmark echoed that sentiment in an interview: “Our exit will be complete. We are not going to supply anything to Russia.”
Russia’s economy has so far weathered sanctions and export controls put in place by governments after Moscow sent tens of thousands of troops to Ukraine, but the imminent withdrawal of Nokia and Ericsson could have a bigger impact on everyday life in Russia , and finally making something more difficult as simple as a phone call.
Russia’s digital ministry did not respond to requests for comment, but this week Maksut Shadaev, minister of communications and mass media, said four telecom operators signed contracts to spend more than 100 billion rubles ($1.45 billion) on Russian-made equipment. .
“It allows us to organize modern production of telecom equipment in Russia,” he said, without naming the operators or producers.
Russia’s largest telecom operator MTS (MTSS.MM) declined to comment on this story. Megaphone, from Veon (VON.AS) Beeline and Tele 2, the other companies that make up Russia’s Big Four telecommunications companies, did not respond to requests for comment.
Government programs to promote Russian equipment have led telecom operators to become less dependent on Nokia and Ericsson in recent years, and Russian manufacturers have increased their market share this year from 11.6% in 2021 to 25.2%.
But cutting ties with foreign companies will slow Russian communications by a generation, according to industry sources, while the rest of the world continues to deploy 5G technologies.
“If this situation is likely to last for years, Russian mobile networks could return coverage to the state of the late 1990s, when their coverage was limited to major cities and the wealthiest suburbs,” says Leonid Konik, who heads IT. publication ComNews in Moscow.
Rural areas will be the first to go broke as operators remove equipment to bolster urban networks, the telecom experts said, while a lack of software updates could lead to network outages or expose them to cyberattacks.
Chinese telecom equipment maker Huawei, the largest supplier in Russia last year with more than a third of the market, will continue to provide software updates and maintenance services, but has stopped selling new equipment in the country, according to sources familiar with the matter. Russia.
SOFTWARE UPGRADES TERMINATE
The biggest hurdle for mobile operators to keep their networks up and running is the lack of software upgrades — Nokia and Ericsson said they would discontinue software updates by next year — and patches, the sources said.
Software unites a variety of equipment that makes up a telecom network, converts analog and digital signals; monitors and optimizes network traffic; and protects the infrastructure against cyber-attacks.
While mobile operators can hoard hardware parts for future use, they depend on a regular schedule of licensed software updates and patches to maintain the integrity of a network.
“Software patches are undoubtedly paramount in ensuring that networks remain operational, secure and reliable,” said Paolo Pescatore, analyst at PP Foresight.
Russian telecom operators stockpiled foreign-made parts in February and March ahead of sanctions, two of the industry sources said, but stocks will plummet after Nokia and Ericsson pull the plug on Dec. 31.
Consolidation among Russian operators on behalf of the government could also allow them to share equipment and resources to help the networks last longer, industry sources added.
Huawei [RIC:RIC:HWT.UL], which stopped selling new equipment in Russia when the United States imposed sanctions on Russia, has also stopped selling its smartphones in the country, according to three sources familiar with the matter. Huawei has not publicly disclosed its status in Russia and declined to comment.
Reporting by Supantha Mukherjee in Stockholm and Alexander Marrow in Moscow; Edited by Kenneth Li and Chris Sanders
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