New Delhi: Telecom gear maker Nokia said that supply chain pressures due to the West Asia war, with component shortages such as memory chips, are increasing costs for devices, including wireless access equipment and network infrastructure.
“We started seeing the cost creeps happening. As soon as the supply shortage starts, the first thing is the cost changes, and that is what is happening right now,” Vibha Mehra, country manager - designate for India at Nokia, told reporters on Tuesday.
Mehra, who will take charge as Nokia’s country manager in India on 1 April, said discussions about the cost increases have also begun with telecom operators.
To be sure, memory chip prices had already been increasing before the war, as manufacturing capacity shifted from consumer electronics toward high-margin memory solutions for AI. The same led smartphone makers to increase device prices in the country as well.
“After the war, it has impacted much more. This was continuing (before the war), but it was manageable,” Mehra said, adding that companies have started prioritizing the purchases for smooth operations.
Pricing pressure
Nokia is one of the leading suppliers of telecom equipment in India, as 4G and 5G networks roll out. In 2025, Nokia’s revenue from India rose 12% to ₹16,250 crore. India contributes about 7.7% to Nokia’s global revenue.
For telecom operators, an increase in equipment costs could lead to higher network expansion expenses. For example, the fixed wireless access (FWA) rollout, the only 5G monetization use case so far, could be impacted in the long run by cost escalations, according to experts.
Analysts and industry watchers said rising cost pressures across key components, including chipsets, memory, printed circuit boards (PCBs), and materials such as Acrylonitrile Butadiene Styrene (ABS) plastics used in device enclosures, are significantly impacting consumer premise equipment (CPE) devices like optical network terminal (ONTs), routers, and set-top boxes.
This ongoing volatility is making it increasingly challenging for manufacturers to sustain fixed pricing models without impacting margins or supply stability, they said.
“As of now, discussions have begun with telecom operators to keep memory and flash storage components outside the long-term pricing contracts, given the continued volatility in global memory prices,” said Sambit Swain, director – Global Sales at GX Group, a Sweden-based broadband gear maker.
According to Swain, operators are actively evaluating more cost-efficient deployment strategies. Fibre-to-the-home (FTTH) remains more economical than FWA for home broadband, particularly when factoring in device costs and long-term lifecycle economics. He said adopting more flexible pricing frameworks, especially for volatile components like memory, will be critical to ensuring supply stability and enabling sustainable broadband deployments.
In its India Mobile Broadband Index 2026 report released on Monday, Nokia said 5G FWA accounts for over 25% of the country's total 5G data traffic of 12.9 exabytes (EB) per month. The report also said India's average monthly mobile data consumption per user crossed the 31 GB mark in 2025, up from 27.5 GB in 2024.
“Telecom equipment like CPEs (consumer premise equipment) and Wi-Fi routers are expected to see modest price increases this year, primarily due to memory price volatility,” said Taimur Zafar, senior analyst at Counterpoint Research. “While regional logistics and geopolitical tensions may add some pressure, the dominant factor remains higher BoM (bill of materials) costs from memory.”
Regarding the price impact on consumers, Zafar said vendors and operators have absorbed much of the impact, but as conditions persist, newer retail variants will reflect higher prices first, followed by adjustments in ISP (internet service provider) markets.