STOCKHOLM – Nokia Siemens Networks, trying to sustain nascent sales growth in the cutthroat phone-equipment industry, is targeting the U.S. market where Chinese rivals face political hurdles and rising data use entices carriers to spend.
The venture owned by Nokia and Siemens is forgoing less lucrative deals in Africa and the Middle East to focus on the United States, CEO Rajeev Suri said last month in an interview. In a shrinking global network-gear market, U.S. demand is rising as AT&T Inc. and other carriers add capacity.
Suri, into his fourth year as CEO, is trying to find areas of strength for the venture that in October posted its first quarterly sales increase and profit since last year. Chinese rivals Huawei Technologies and ZTE, which have made gains globally, are struggling to win orders in the U.S. as the country’s officials advise against buying from them.
The industry is a tough place, Suri said in Munich. The U.S. is certainly an opportunity so we’ll be there.
Equipment for faster networks allowing consumers to watch video and browse the Web on their mobile devices helped Espoo, Finland-based Nokia Siemens boost sales in the Asia Pacific region 29 percent last quarter, driven by South Korea and Japan. Sales in North America fell 6 percent, a trend it is now trying to reverse by ramping up marketing spending and tapping the rising demand for data services.
Nokia Siemens vies with Huawei for the second spot in the global wireless-gear market behind Ericsson of Sweden.
While cheaper equipment has helped Huawei and ZTE gain market share in Europe and Asia, U.S. carriers have so far been wary of awarding them large contracts.
The two companies, China’s largest phone-equipment makers, provide opportunities for Chinese intelligence services to tamper with U.S. telecommunications networks for spying, the U.S. House of Representatives Intelligence Committee said in an Oct. 8. report, advising against using their gear. China’s Commerce Minister last month rejected the U.S. concerns.