Nokia Announced Domestic Manufacturing of Electronics Equipment for Fiber

Jul 27, 2023

The manufacturing of the company’s fiber-optic broadband electronics products will start in 2024.

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WASHINGTON, August 3, 2023 – Nokia is set to announce the U.S.-based manufacturing of key electronic components for fiber-optic broadband networks on Thursday.

The announcement, which is set to be made with Vice President Kamala Harris and Commerce Secretary Gina Raimondo in Kenosha, Wisconsin, is specifically focused on providing U.S-manufactured electronics products and optical modules for use in the $42.5 billion Broadband Equity Access and Deployment program.

The Finland-based telecommunications company is partnering with Sanmina Corporation to manufacture products in Sanmina’s manufacturing facility in Kenosha. The announcement makes Nokia among the first telecom equipment manufacturers to announce that core electronic components of its fiber equipment will be made in America.

Requirements under the Infrastructure Investment and Jobs Act’s BEAD program state that program recipients must source at least 55 percent of their components by cost from the United States, either manufactured, produced, or mined in the country.

This requirement is part of President Joe Biden’s Made in America agenda which seeks to support the country’s manufacturing economy. The regulation will increase the requirement to 75 percent by 2029, according to Biden.

The manufacturing of the company’s fiber-optic broadband electronics products will start in 2024, according to Nokia. Production is expected to bring up to 200 new jobs to Wisconsin’s state. Nokia said it will be able to supply its products and services to critical BEAD projects.

Nokia CEO Pekka Lundmark said that the company is “committed to connecting people and communities. However, many Americans still lack adequate connectivity, leaving them at a disadvantage when it comes to accessing work, education and healthcare. Programs like BEAD can change this.”

“By bringing the manufacturing of our fiber-optic broadband access products to the U.S., BEAD participants will be able to work with us to bridge the digital divide. We look forward to bringing more Americans online,” Lundmark continued.

Jure Sola, chairman and CEO of Sanmina, said that the company is “excited to partner with Nokia to support their efforts to build robust and resilient high-tech fiber broadband networks that will connect people and societies. By continuing to invest in domestic manufacturing, Nokia and Sanmina will be able to help create a sustainable future for the industry, one that drives job growth and ensures the fiber products produced embody the quality and excellence associated with American manufacturing.”

The announcement comes a week after Biden’s “Made in America Week” that celebrated supporting American works and domestic businesses. The Biden Administration’s Investing in America initiative is investing billions of dollars into the United States’ domestic manufacturing. Congress passed the Inflation Reduction Act and CHIPS and Science Act which invest in America’s electric vehicle and green energy plans and semiconductor manufacturing.

Biden ran his presidential election campaign on his initiative to move companies onshore, defend American supply chains, and create more jobs. According to the White House, the agenda has “already attracted hundreds of billions of dollars in private investment and created nearly 800,000 new manufacturing jobs in everything from semiconductors and electric car batteries to clean energy technology and more.”

Industry experts have called on the NTIA to provide clear guidelines on the implication of Buy America requirements for BEAD projects, claiming that the requirements spread uncertainty surrounding the impact of the funds due to the increased complexity of an already complicated supply chain. The NTIA has already issued waivers for its $1 billion Enabling Middle Mile Broadband Infrastructure program to exempt certain construction materials from the requirement list. NTIA head Alan Davidson, however, indicated that getting such exceptions for BEAD-funded projects would be very difficult.

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Migrating into a full utility may take decades, but municipalities should be prepared.

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WASHINGTON, July 21, 2023 – Municipalities need to own broadband infrastructure because internet service will eventually evolve into a form of utility, said Chris Perlitz, managing director at investment banking firm Municipal Capital Markets Group at the Fiber Broadband Association event, “Where’s The Funding?”, on Wednesday.

Municipalities currently do not have the expertise or capacity to operate a network which is where internet service providers come in and form a partnership, Perlitz said. However, in the future, artificial intelligence and machine learning will simplify the operation and the system will become a utility and managed by a municipality, he said.

Perlitz predicted that migrating into a full utility format may take decades. He urged municipalities to invest in networks now in preparation for the “long game.”

The cost of capital in building infrastructure is a lot cheaper for municipalities than for private, for-profit service providers, Perlitz said. Municipalities do not need high margins to pay off investors and aim to operate a zero-sum game with no profits.

Nonprofits are good recipients of grants, he added, claiming that the government should consider how they can motivate a municipality to enter into the internet.

Many experts claim that a utility-based broadband model is the only solution to bridge the digital divide, claiming that utilities understand how to operate large infrastructure projects that connect hundreds of homes and have core internal communication capabilities.

Capping the number of providers could solve price war problems, one telecom exec said.

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WASHINGTON, July 19, 2023 – Open access network operators should limit the number of ISPs on their network to avoid price wars and poor customer experience, said panelists at a Fiber Broadband Association event Tuesday.

In an open access network, broadband infrastructure is owned by one entity, which can be a network operator or a municipality or other form of cooperative governance. The network operator leases the infrastructure to internet service providers.

Gabe Gomez, vice president of customer experience at ISP Syringa networks, said that Syringa chose to operate on an open access network due to the network’s policy that limited the number of ISPs and maintained a strong vetting process for those providers.

The potential take rate in a network is higher when the network operator limits the number of ISPs on the network, said Gomez. Having too many providers makes it difficult to get the market share and investment an ISP needs to provide a good experience to the customer, he continued.

“If you have too many ISPs, some will lose,” he added, and customers will end up paying for it with bad experiences and poor customer support.

Although an open access model is considered the “gold standard” by some network operators, including Utah-based UTOPIA Fiber, some commentors are concerned that the model will reduce ISPs to price-war strategies to eliminate competition and retain market share.

According to Gomez, limiting providers is a sustainable solution to price gauging concerns.

Chief Marketing Officer at UTOPIA Fiber Kim McKinley told Broadband Breakfast that its network, however, does not have price gouging concerns, stating that the company views both provider and end user as its customers and does what it can to protect each.

UTOPIA Fiber hosts 18 ISPs on its residential network competing for customers. Although hosting many providers on a single network does not work for small communities, the model is successful in UTOPIA’s cities and it supports small local ISPs while providing variety to the end users, said McKinley.

Furthermore, UTOPIA’s model gives small and local providers a shot to compete with the larger companies they otherwise would not have been able to compete with, she added.

George Templeman, president of network access partnerships at open access network operator SiFi Networks, said that the open access model provides customers with access for a diverse choice in ISPs that provide high-quality service.

The model is cost effective, environmentally friendly, and provides customers with the best experience, Templeman said, touting one-time builds and sustainable fiber infrastructure.

’The industry needs to get off its speed fixation.’

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WASHINGTON, June 29, 2023 – The future of broadband should not be viewed with only speed in mind, but other attributes that consumers are increasingly looking for, said panelists at a Broadband Breakfast Live Online event Wednesday.

Network attributes like reliability, in-home Wi-Fi, resiliency, security and latency will play an increasingly important role in consumer demand, said Jason Livingood, vice president of technology policy, products and standards at cable company Comcast.

“The industry needs to get off its speed fixation,” agreed Dan Grossman, senior analyst at semiconductor analyst TechInsights. “Fiber wins on reliability, latency, consistency, and brand image.” He argued that providers should be using those metrics for brand positioning rather than speed claims, as it is no longer “all about speed.”

“Who needs [multiple Gig speeds]? Who could possibly use it?” said Grossman. Most people who buy these speeds are “wasting their money,” he argued.

Photo of Dan Grossman

Nokia rolled out a 25-gigabit symmetrical PON in January. A PON service can support multiple clients from a single router by splitting a fiber-optic strand from an optical line terminal. It differs from an active optical network which dedicates each end user their own fiber line by an electrically charged switcher that manages the signal distribution from the fiber line to service the end destinations.

Despite Nokia representatives claiming that deploying 25G PON is ideal for providers that want to provide customers with 10G or higher speeds and ensure future applications will be supported by their networks, Grossman argued that it will be years before 25-gig services are needed.

American providers are ahead of global efforts on deploying XGS-PON which delivers 10G symmetrical speed, said Grossman. He predicts that 10G will be the solution to small business and residential fiber for the foreseeable future.

Although household internet traffic continues to grow, the annual rate of growth is slowing, claimed Grossman. This means that there is an expanding gap between what consumers pay for and what they will need and use, he claimed.

“Increasing capacity was a proxy for improving the quality of the customers” for several decades, said Livingood. He claimed that the country is at the point of diminishing returns for extremely high-capacity levels.

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Wednesday, June 28, 2023 – The Future of Ultra High-Speed Connectivity

Over the last several years, rapid technological advances have brought dramatic increases to home internet speeds. Fiber-to-the-home is often heralded as the gold standard for fast, future-proof broadband. How are fiber technologies evolving to adapt to ever-higher capacity? What about alternative technologies besides fiber, both wire-based and wireless? How are these technologies supplementing the fiber-driven future of ultra high-speed connectivity?

Panelists

Gary Bolton serves as president and CEO of the Fiber Broadband Association — the largest trade association in the Americas dedicated to all-fiber-optic broadband. With more than three decades in the telecom industry, Bolton joined the Fiber Broadband Association as president and CEO in 2020 after serving on the association’s board as vice chairman, treasurer and vice chairs of public policy and marketing committees. Prior to taking the leadership role at the Fiber Broadband Association, Gary spent 11 years at ADTRAN serving as vice president of global marketing and government affairs. Gary has been highly involved in Washington, particularly on FCC and Congressional proceedings and international trade issues.

Jason Livingood serves as vice president of technology policy, products and standards at Comcast. As part of this role, he coordinates Comcast’s efforts to develop open standards, spur research and development by leading the Comcast Innovation Fund and engaging with universities around the world, apply research and standards to initiate new network and services’ concepts, and engage with governments, regulators and other external key stakeholders. Jason joined Comcast in 1996 to help the company launch high-speed Internet services and has also been instrumental in the creation and launch of Comcast’s business class internet services, Xfinity Voice, Xfinity Home and Xfinity WiFi.

Dan Grossman has a wealth of expertise in fixed networks, both as an industry analyst and as a technologist. His engineering background and mindset combined with his business acumen gives him unique insight into the interplay between use cases, technology, and business strategy. At TechInsights, his focus is on research and client services in the fixed services and equipment market, including fiber-to-the-premises, fixed wireless access and optical networks, from both the service provider and vendor perspectives. Prior to TechInsights, Dan was principal at his consulting firm, NetAccess Futures, a contributing analyst at Heavy Reading and an associate at Interisle Consulting Group.

Drew Clark (moderator) is CEO of Breakfast Media LLC. He has led the Broadband Breakfast community since 2008. An early proponent of better broadband, better lives, he initially founded the Broadband Census crowdsourcing campaign for broadband data. As Editor and Publisher, Clark presides over the leading media company advocating for higher-capacity internet everywhere through topical, timely and intelligent coverage. Clark also served as head of the Partnership for a Connected Illinois, a state broadband initiative.

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