China and Asia in the Nokia strategy

Nokia Networks’ operations in China

We have established our global procurement center in Shanghai. The center works with over 2,000 direct suppliers, which in turn employ 550,000 employees.

We have approximately 8,000 employees engaged in R&D, manufacturing, client service, and supply chain management in China.

We have provided telecommunications support for national events including the Beijing 2008 Olympic Games, the Military Parade of the 60th anniversary of the founding of People’s Republic of China, the Shanghai World Expo, and other major national events.

We have served all three of

China’s mobile

telecommunications operators

and over 350 million users for

more than two decades .

Net revenue in China reached more than EUR 1.4 billion in 2014, accounting for 11% of our global revenue.

We have 4 innovation centers and 3 manufacturing sites in China and 50 representative offices in Mainland China, Hong Kong, and Taiwan.

Nokia’s16-year contribution to TD technology development in China

First TD-

SCDMA

open lab,

best test

platform in

ecosystem

Support China

in application

process to

include TD-

SCDMA as

part of ITU 3G

standard

World 1st

uplink 2.2

M bps in

HSUPA

Support China

to make TD-

LTE-Advanced

as ITU 4G

standard

World’s 1st

World’s 1st

World 1st TD-

SCDMA call

World’s 1st

2007

1998

2013

2012

2001

2008

2010

2011

In 2001, first TD-

SCDMA video call

between Mr. Lou

QinJian (former Vice

Minister of MIIT) and

CEO of Siemens

World 1st TD-

SCDMA

outdoor test

World’s 1st

2005

World 1st TD-

LTE open lab

World’s 1st

First TD-LTE

video call

between

Mainland and

Taiwan

World’s 1st

GTI: Market

development

award

Supported

to include

Zu Chongzhi

encryption

algorithm in

3GPP

standard

World 1st

TD-LTE

1.6 Gbps demo

Mr. Miao Wei, Minister of MIIT,

visited Nokia TD-LTE A Demo

Successfully

supported

CMCC to

include

convergence of

LTE TDD frame

structure in

3GPP standard

2014

World Record:

TDD-FDD LTE

CA throughput

4.1 Gbps at ITU

Doha on Dec.

World 1st voice

call handover

between 3G TD-

SCDMA and 2G

GSM

World’s 1st

China Friendship

Award

4

Some success factors in China/Asia

Key success factors:

• Understand the national interest and the priorities of the 5-year plan and target alignment. Understand the key performance indicators of the central and local government officials. Seek for areas of win-win.

• Build and maintain a network of senior officials who are sympathetic to your causes.

• Adequate level of personnel and other resources needed.

• Adequate local and global business management level attention needed.

Watch the following factors:

• Economic situation – e.g.budget deficit?

• Political stability – upcoming elections?

• The stage of industrialization – impact on cost development?

• Membership in WTO?

• General administrative culture - based on legislation or personalrelationships?

• Do you have flexibility to react to increased risks caused by the abovefactors?

5

Some challenges in China/Asia

• Mere number of officials relevant to your business.

• Complex business license questions.

• Joint Ventures still required for certain activities.

• In China role of Industry Associations smaller than in many other countries.

• Legal questions

– Consider how the litigation system works in your business (e.g. IPR, consumer protection).

– Creating IPR and bringing it back to your home country is possible, but you may lose some benefits if that is done to a too high extent.

• Supply of adequate competences, many governments still need to workon improving local education systems.

• At the same time bringing in foreign workers to bridge the competencegap may not be easy enough.

• Pressure for using local suppliers –competencies a question.

• Corruption has not been an issue for Nokia – our zero tolerance has beenacknowledged.

CHINA

6

“Investing for the Future”

… a great business and country to be in…