It is a privilege to write to you as Nokia’s new President and CEO.

Since my announcement in February, I have been working closely with Pekka to start the transition. I have met with some of our largest customers and spent time with the Group Leadership Team and members of our Board of Directors.

In those conversations, it has become clear that you have done a huge amount to put Nokia on a positive footing. This includes investing significantly in innovation; regaining technology competitiveness in 5G; building market-leading solutions for network monetization; taking share in Core; strengthening positions across Fixed, IP and Optical Networks; closing the Infinera acquisition; monetizing Nokia’s intellectual property; and developing early adjacencies in defense, data centers and enterprise.

As a team, you deserve an enormous amount of credit for this work, as it puts Nokia in a strong position to capitalize on the big market opportunity in front of us.

The internet supercycle fundamentally redefined networks from voice-centric to data-centric. As we begin the AI supercycle, I believe we will see a similarly radical transformation.

Emerging waves of AI – including deep learning and machine learning, agentic AI and robotics – will require advanced connectivity, with networks designed, deployed and managed differently. This will create opportunities for us and our customers.

AI is already transforming the data center. Networks need to be ultra-high bandwidth and resilient, and will increasingly rely on optics. As a result, the level of investment required for AI data centers is higher than that required for cloud data centers.

We need to clearly focus on the market opportunity and how Nokia can add the maximum value for our customers and shareholders. That is why I will spend my first 100 days learning from our customers, employees, investors and other key stakeholders. My focus is on delivering a clear vision and strategy for the future of Nokia’s journey while ensuring we deliver on our commitments for 2025.

This is an exciting time in our industry and for our company. Let’s seize it.

Justin Hotard
President and Chief Executive Officer (CEO)

Nokia statement: “Nokia is proud to be T-Mobile’s long-standing partner in Radio Access Networks (RAN). We are confident in our industry-leading portfolio which has helped us grow market share with many of our existing RAN customers as well as to win completely new ones. We continue to support our global customer base with best-in-class field performance, technology, software and services.

In response to some recent analyst claims, Nokia states that these comments mainly relate to its first generation 5G products designed in 2018. Since then, strong investment in R&D, System on Chip technology and new product launches have positioned Nokia as one of the market leaders globally. This is visible in the customer contracts we have recently won, increasing our market share in many regions including India, Japan, Brazil, New Zealand and Vietnam.”

T-Mobile statement: “T-Mobile works with both Nokia and Ericsson on our RAN, who have helped us over the years build the largest and fastest 5G network in the nation. We continue to work with them on ensuring our customers have the best mobile network experience. We have made no decision to end our working relationship with Nokia, and any reports in the media implying this are untrue."

Poland’s six-month presidency starts in January 2025 as the new European Commissioners take office. It will play a significant role in shaping the political agenda and setting the priority focus areas for the next European Commission mandate.

Ahead of a meeting today between Secretary of State at the Ministry of Digital Affairs, Dariusz Standerski, ambassadors, Office of Electronic Communication, and senior representatives from Ericsson, IBM, Intel, Nokia and Vodafone, the companies urged the incoming presidency to drive a renewed approach to incentivize investments in the digital sector.

Political momentum is gathering following reports by former Italian prime ministers Enrico Letta and Mario Draghi advocating for changes to improve the EU’s faltering competitiveness. The reports warn that the EU is falling behind the US and China on multiple counts.

Marc Vancoppenolle, VP Policy and Government Affairs EU & Europe at Nokia, joined his counterparts in asking policymakers to incentivize investment and foster innovation to boost Europe’s competitiveness.

"Europe's focus must be on leading the industrial internet globally by investing in and leveraging emerging technologies like enterprise AI, quantum computing and 5G standalone connectivity. Collaboration between Member States, the EU, and industry is essential to drive the deployment of top-tier digital infrastructure, adopt productivity-boosting tools for driving green, secure and digital transformation across industry sectors."

Areas highlighted for critical intervention include research investment, the deployment of digital infrastructure including 5G and fiber networks, and the development of emerging technologies such as artificial intelligence.

Ericsson, IBM, Intel, Nokia and Vodafone today reiterated calls for policymakers to focus on the following key areas to increase the EU’s competitiveness through technology.

1. Put digital transformation front and center of Europe’s industrial competitiveness strategy
   Promote green and digital transformation across all industry sectors, SMEs and public services to drive productivity, improve services and accelerate decarbonization. This twin transitions, powered by advanced, trusted connectivity will be key to sharpening Europe´s competitive edge and supporting its technology leadership.
2. Accelerate the development of a true Digital Single Market
   Focus on making existing regulations work for the digital economy and prioritize an investment and innovation first approach to regulation with a focus on simplification, predictability and effective implementation.
3. Incentivize investment in advanced connectivity
   Advanced connectivity infrastructure such as 5G and fiber will be critical to underpinning Europe’s digital transformation and delivering on its net zero ambitions. Competition and regulatory policy reform should focus on incentivizing investment by enabling scale and reinforcing EU wide best practice on spectrum pricing and licensing. A modernized fit for purpose regulatory framework through the development of a new Digital Networks Act must be prioritized.
4. Build policies that foster trust and thriving partnerships
   The policy framework must balance robust laws with an environment that builds trust and allows companies to scale responsibly and thrive in Europe including through trade, recruitment, and research. Cooperation between long standing trusted partners, including transatlantic cooperation, is essential to supporting a positive business environment.
5. Ensure Europe is ready to reap the benefits of quantum and AI
   Policymakers should prepare for the quantum era by promoting early-stage experimentation in industrial application and deployment, encouraging resilient supply chains, and incentivizing private sector investment in Europe. Policymakers should also focus on preparing critical infrastructure for migration to quantum-safe standards as part of their cybersecurity policy planning – areas that deserve particular and increased R&D support.

At the dawn of a new European Commission, the Polish EU Presidency has a unique opportunity to accelerate Europe’s progress in these areas. Ericsson, IBM, Intel, Nokia and Vodafone look forward to collaborating with Poland on this exciting journey.

Europe is approaching the mid-twenties of the new century in the context of an unstable geopolitical environment and uncertain economic outlooks. Great challenges and opportunities lie ahead of us, which require Europe to embrace the digitalisation of its societies and economies. Developing and implementing digital innovation is critical to increase Europe’s competitiveness. In this context, enhanced and secure connectivity underpins digitalisation as one key enabler for productivity and decarbonization across sectors.

The European Commission noted in a recent White Paper that “the future of competitiveness of all sectors of Europe’s economy depends on advanced digital network infrastructures and services, as they form the basis for global GDP growth between EUR 1 and 2 trillion”. The Digital Decade targets state that new 5G and FTTH networks or satellites must reach almost every corner of Europe by 2030, so that no citizen and no business is left behind. Heads of government, in recent European Council conclusions, also noted that “digital transformation of business, government and society requires a true Single Market in digital services and data, encouraging and facilitating investment in digital infrastructure like 5G and 6G, and the application of game- changing digital technologies such as AI, blockchain, quantum computing and immersive reality technology”.

In the past decade, as noted in a paper by the European Round Table for Industry, €500 billion have been invested by telecom operators in upgrading and expanding Europe’s networks. Mario Draghi – who just issued his milestone report The future of European competitiveness – reminded us that, despite efforts, telecom “investment per capita is half of that in the US, and we are lagging in 5G and fibre deployment”.

This is why we agree with the Commission analysis that more must be done to fix the situation and we support action aimed at improving investment in connectivity and digitalisation across the Continent.

What is at stake for the European economy is much more than the future of one sector. It was underlined by former Italian Prime Minister Enrico Letta in his high-level Report when he noted that “the lack of integration in the financial, energy, and electronic communications sectors is a primary reason for Europe's declining competitiveness”. If we do not swiftly create the conditions for a major increase in network investment now, then the entire European industrial fabric will suffer.

Today, European businesses invest in digitalising their processes, applying AI, and accomplishing the “Industry 4.0” vision, but this cannot be achieved without innovative connectivity. To put it in Enrico Letta’s words: “technologies such as 5G (6G in the future), IoT, web3.0, edge-cloud computing or AI will create entirely new economic opportunities. Of course, the deployment of these technologies relies on networks, which will provide new capabilities such as increased computing power or different latency levels”. Being home to some of the world’s top telecom manufacturers, Europe has been a major force in advancing network innovation. However, more support is needed if we are to continue to build European technology leadership in trusted and advanced connectivity.

A wealth of use cases is at stake, across sectors of the economy and of society: we would like to offer some examples of the depth and range of such use cases.

In the mobility sector, secure connectivity and services can help make traffic safer and less polluting. In the EU internal energy market, smarter networks and AI can benefit the entire value chain, including generation, transmission, distribution, and commercialization. This includes technologies such as fast connectivity for remote renewable sites or enabling intelligent consumption to reduce demand peaks.

In renewables, modernising and expanding the network infrastructure can secure the transmission, processing and use of large data volumes for smart meters and flexibility demand. In the healthcare sector, digital infrastructures are crucial for advancing in e-health: this includes digital monitoring and care, remote trials, as well as AI solutions for faster drug discovery, manufacturing, and supply. In the railway sector, we require investment in 5G for the Future Railway Mobile Communication System (FRMCS) and improved passenger services. 5G and FRMCS will offer secure, efficient, and high-capacity communication for railway modernization and safety, along with reliable on-board connectivity, improving the passenger experience.

Connectivity networks will also enable AI usage across industries, from classical forecasts and recommendations to intelligent business networks, digital assistants and generative AI models. Moreover, a harmonized, innovation-friendly implementation of the EU AI Act will be essential for AI to flourish in Europe.

5G private networks, in specific, can boost industrial automation by connecting heavy-duty applications across various sectors. These applications work in harsh and remote environments, enabling wider and easier digital deployment in industrial sites. More investment is also needed to fight cybercrime, with all stakeholders joining the effort and in a harmonized way across the single market: we must protect critical infrastructures such as power grids as well as vital economic activities such as those in the financial sector.

Europe’s industrial base is powerful, but it requires high levels of investment and adequate policy conditions so that each of its parts can grow, innovate and stay competitive at the global level. Connectivity is no exception. As European industry, we need increased collaboration and investment in trusted, secure, resilient, and high-quality connectivity, as well as in computing infrastructure.

This is why we, as leading CEOs, believe that it is urgent to take action now and shape the future of European digital infrastructure. European competitiveness is at stake. We applaud the launch of the EC White Paper and believe it is essential to ensure that the needs and proposals of all industries are considered in future work. Only by doing so can the efforts of European players be sustainable and successful.

This open letter is signed by:

Aiman Ezzat, CEO, Capgemini
Börje Ekholm, President & CEO, Ericsson
Christian Klein, CEO and the Chairman of the Executive Board, SAP SE
Christian Sewing, CEO, Deutsche Bank
Cláudia Azevedo, CEO, Sonae
Claudio Descalzi, CEO, Eni S.p.A.
Flavio Cattaneo, CEO, Enel
Gonzalo Gortázar Rotaeche, Consejero Delegado (CEO), CaixaBank, SA
Ignacio S. Galán, Executive Chairman, Iberdrola
Leonhard Birnbaum, CEO, E.ON SE
Luca de Meo, CEO, Renault Group
Markus Krebber, CEO, RWE AG
Michael Strugl, CEO, VERBUND
Óscar García Maceiras, CEO, Inditex, S.A.
Pekka Lundmark, President & CEO, Nokia Corporation
Peter Herweck, CEO, Schneider Electric
Richard Lutz, Chairman of the Management Board and CEO, Deutsche Bahn AG
Robert Falck, CEO, Einride
Roland Busch, President and CEO, Siemens AG

As a result, the Department of Commerce is publishing and maintaining a list of manufacturers where an officer of the company has certified certain individual products it produces. In accordance with this process, subject to fine or imprisonment - under the Program Fraud Civil Remedies Act (31 U.S.C. § 3801 et seq.) and the False Claims Amendments Act of 1986 and the False Statements Accountability Act of 1996 (18 U.S.C. §§ 287 and 1001, respectively) Nokia certifies that it is compliant with the BABA waiver for the BEAD Program.

Nokia certifies the equipment listed below meets the domestic manufacturing requirements outlined in the BABA waiver.

Our SBTi-approved targets are as follows:
 

• Nokia commits to reach Net-Zero greenhouse gas emissions across the value chain by 2040.
• Nokia commits to reduce absolute scope 1, 2 and 3 GHG emissions by 50% by 2030 from a 2019 base year.
• Nokia commits to reduce absolute scope 1, 2 and 3 GHG emissions by 90% by 2040 from a 2019 base year.

Over and above the SBTi-approved targets, Nokia is announcing an acceleration of its near-term targets to decarbonize Scope 1 and Scope 2 emissions (greenhouse gas emissions from our own facilities and fleet across the world, as well as purchased electricity by 2030 from the same 2019 baseline).

We were the first telecoms vendor to have our Science Based Target (SBT) validated by the SBTi in 2017 and were among the first 100 companies to do so. We recalibrated our targets in 2021 in line with a 1.5°C warming scenario, which means we are publicly committed to reduce our GHG emissions by 50% across our value chain (Scope 1, 2 and 3) by 2030 from a 2019 baseline. This near term 2030 target implied that Nokia would reach net zero by 2050. Subsequently, as part of the EU Commission Green Digital Coalition, we committed to reach net zero by 2040.

With our new announcement we therefore not only reiterate our prior commitment to reach a 50% reduction in our value chain by 2030 from a 2019 baseline, but we are also now accelerating our 2030 scope 1 and 2 targets to reach 90% by 2030 instead of 50%.

Find out more

It has been clear for Nokia since the early days of the invasion of Ukraine that continuing our presence in Russia would not be possible. Over the last weeks we have suspended deliveries, stopped new business and are moving our limited R&D activities out of Russia. We can now announce we will exit the Russian market. During this process our priority continues to be the safety and wellbeing of our employees.

For humanitarian reasons, Western governments have expressed concerns about the risk of critical telecommunication network infrastructure in Russia failing. They have also emphasized the importance of ensuring the continued flow of information and access to the internet which provides outside perspectives to the Russian people. Therefore, as we exit we will aim to provide the necessary support to maintain the networks and are applying for the relevant licenses to enable this support in compliance with current sanctions.

This is the most responsible course of action for Nokia to take as we exit the Russian market.

Regarding the financial impact of the decision, Russia accounted for less than 2% of our net sales in 2021. Considering the strong demand we see in other regions – we do not expect this decision to impact our ability to achieve our 2022 outlook provided in the Nokia financial report for Q4 and full year 2021 issued on 3 February 2022. We expect this decision to lead to a provision in Q1 of approximately €100m which will impact our reported but not comparable financials.

The New York Times, in its article of March 28, makes claims regarding Nokia’s role in Russia’s lawful intercept system, also known by the abbreviation SORM. Nokia believes this article is misleading. As Nokia has made clear to The New York Times, Nokia does not manufacture, install or service SORM equipment or systems. Any suggestions that we do, are incorrect.

Lawful intercept is a standard capability that exists in every network in almost every nation. It provides properly authorized law enforcement agencies with the ability to track and view certain data and communications passing through an operator’s network for purposes of combatting crime.

Nokia is one of many network infrastructure providers who supplied the Russian market. The article claims Nokia networks play an active part in enabling SORM equipment. This is incorrect. Like any other network infrastructure suppliers, Nokia is required to ensure that the networking products we sell have passive capability to interface with lawful intercept equipment of law enforcement agencies. This is governed by internationally recognized standards, as well as local regulations. All Nokia deals go through a strict Human Rights due diligence process that has been externally assessed and vetted by the Global Network Initiative (GNI). We are the first and only telecommunications equipment vendor to have this external assessment in place.

Despite numerous requests, Nokia was not provided with the documents that the New York Times purportedly based its story on and therefore was not able to comment on their authenticity. However, the NYT confirmed to Nokia that they were the same documents that were shared and publicly reported on by TechCrunch in 2019 and it was made clear at the time that they do not show Nokia manufacturing, installing or servicing SORM equipment or systems.

Lawful Intercept

Lawful intercept is a standard capability that exists in every network in almost every nation. It provides properly authorized law enforcement agencies with the ability to track and view certain data and communications passing through an operator’s network for purposes of combatting crime. In Russia it is known as “SORM.” Nokia does not manufacture, install or service SORM equipment or systems. Any suggestions that we do, are incorrect.

Nokia, like every network infrastructure supplier, is required to ensure that the networking products we sell can interface with lawful intercept equipment of lawful enforcement agencies. This is governed by internationally recognized standards, as well as local regulations. The lawful intercept capability that may exist in an operator’s network which contains Nokia products is the obligation of the operator and any associated equipment is provided by third parties. Nokia does not have an ability to control, access or interfere with any lawful intercept capability in the networks which our customers own and operate.

New York Times

Nokia has not been provided with the documents that the New York Times has purportedly based its story on. However, the NYT confirmed to Nokia that they were the same documents that were shared and publicly reported on by TechCrunch in 2019 and it was made clear at the time that they do not show Nokia manufacturing, installing or servicing SORM equipment or systems. Nokia has offered and continues to be willing to sit down with the New York Times to help its journalists better understand our technical documents.

The information that was already published by TechCrunch in 2019 does not show anything more than Nokia’s product interfaces meeting the standards-based, legal requirements related to lawful intercept. The same standards and legal requirements have governed every other infrastructure supplier which has supplied equipment in Russia.

In fact, Nokia is not even permitted to access SORM equipment or systems whether sitting on an operator or relevant authority’s premises. Additionally, it is a third party which converts the standards-based interface in Nokia’s products to fit with the legal intercept requirements – a fact which is also reflected in the 2019 documents.

A Commitment to Human Rights

Nokia ensures that all deals go through our strict Human Rights due diligence process which is based on international principles such as those of the United Nations Guiding Principles on Business and Human Rights. This process has been externally assessed and vetted by the Global Network Initiative (GNI) as the first and only telecommunications equipment vendor. We comply with all legal restrictions, including having the correct export licences from the relevant governments.

We condemn any misuse of lawful intercept to infringe on human rights. To prevent this, there is a strong need for multi-lateral action to ensure sufficient frameworks are put in place. We believe this topic requires immediate attention and through our participation with GNI have called for more information about existing legal and technical architectures, as well as debate on possible modifications that might be required.

Nokia Condemns Russia’s Invasion of Ukraine

As stated on March 4, Nokia strongly and unequivocally condemns the Russian invasion of Ukraine and the deaths of innocent people. Nokia stands for human rights, international co-operation and the rule of law. We support and comply with all sanctions and restrictions and have suspended all our hardware and software deliveries to Russia.

More information

On lawful interception, ETSI: https://www.etsi.org/technologies/lawful-interception
On the Nokia Human Rights Due Diligence (HRDD) process: https://www.nokia.com/about-us/sustainability/integrity/

I am shocked and devastated by the terrible scenes we’re witnessing in Ukraine as the Russian invasion continues. Many of us thought that war in Europe was unimaginable in 2022. Sadly, that view has proven to be mistaken. The invasion of Ukraine is a clear violation of international law. Nokia strongly and unequivocally condemns this war and the deaths of innocent people.

Nokia stands for human rights, international co-operation and the rule of law. The safety of our employees in Ukraine remains our top priority. We are supporting them with logistical and financial assistance and a crisis team is in close contact with our people to offer any additional help we can provide.

Nokia will donate €1 million to UNICEF to help support its humanitarian work in Ukraine, which is focused on the critical needs of children and families. In addition, we will work with UNICEF to provide a platform for employee fundraising.

Our focus is also on ensuring we comply with all sanctions and restrictions and have suspended our deliveries to Russia for the time being.

Only through the world acting together can we end the human suffering and bring an end to this war.

We are deeply concerned about the invasion in Ukraine and our hearts go out to all those affected by this conflict.

Nokia believes in international collaboration and peaceful co-existence as the best way to improve living standards across the world. As an organization, we support multi-lateral engagement and efforts at de-escalation to stop conflict.

As always, the safety and wellbeing of our people is our top priority and we continue to work to support any affected employees and their families. We have established a crisis management team who are closely monitoring the situation and working to mitigate its potential impacts on our people and operations.

We are taking a number of steps to support our employees in Ukraine including:

• We are in direct and regular contact with our employees, to check on their situation and any requests for support.
• We have approved additional financial support for our employees to support their own safety response measures, including advance payment of salary and extra cash for expenses.
• We have upgraded our employees’ mobile subscriptions to the highest possible level to help ensure they can continue to communicate.

Our focus is on ensuring we comply with all sanctions and restrictions on Russia and have put a pause on our delivery system. This is a complex situation which is evolving rapidly and we continue to assess it.

Nokia welcomes the UK government’s announcement relating to the deployment of open and interoperable networks. Nokia has long been a champion of open networks and we are the leading contributor to the O-RAN ALLIANCE’s technical work. Open RAN technology has the potential to enrich the mobile ecosystem with new solutions and business models. Nokia has a long history in the UK, that stretches back many decades. We play a vital role in the delivery of the UK’s Critical National Infrastructure and we are active in our support for the UK government’s ambitions to provide resilience and security to the UK’s telecoms infrastructure. We will continue to play a leading role in supporting and shaping its future and we offer our support whenever, and wherever, it is needed to help the UK government deliver on its strategy.

“As one of the major European manufacturers, Nokia is of strategic importance to Deutsche Telekom. It is well known that Deutsche Telekom is pursuing a multi-vendor strategy so that we are not dependent on just one supplier. This is an elementary part of our security philosophy. However, as in the past, Deutsche Telekom will not comment on individual contractual relationships and strategic purchasing decisions”, said Claudia Nemat, Board Member Technology & Innovation, Deutsche Telekom. “In 2019 we have made many steps together with Nokia to make Deutsche Telekom’s networks evolve towards 5G readiness, including all network domains, from radio and fixed access to transport and core, and continue to do so in 2020 and onwards”

“We have been a long-term partner of Deutsche Telekom and have been proud to work with them extensively over the years, providing leading network technology and services. We continue to work extensively with Deutsche Telekom which is one of our most significant customers, both in Europe and the U.S.”, said Federico Guillén, President of Customer Operations, EMEA & APAC, Nokia.

Media Inquiries:

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E-mail: media@telekom.de

Nokia
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