Nokia bows to Buy American rules with new U.S. broadband plant

Nokia is teaming with longtime manufacturing partner Sanmina to bring production of fiber network electronics to the U.S. state of Wisconsin, hoping the move will help it bring in the cheese when money starts flowing from the $42.5 billion Broadband Equity, Access and Deployment (BEAD) Program. The decision will notably allow it to meet Buy American rules associated with the grant program, which require awardees to source materials with a high percentage of domestic content.

Lori Adams, VP of Broadband Policy and Funding Strategy at Nokia, said it plans to build four products at Sanmina’s plant in Kenosha, Wisconsin: optical line termination (OLT) cards for modular access nodes, a small form-factor OLT, OLT optical modules and a hardened optical network terminal (ONT). Production is expected to begin in 2024, with products ready for shipment by the middle of the year.

Nokia isn’t the first to move its manufacturing operations stateside: In May, India-based STL announced plans to open its first fiber optic cable plant in the U.S. in South Carolina. Others, including Corning, CommScope and Prismian Group have announced plans to ramp up their fiber manufacturing capacity in the U.S. with new facilities in Arizona, North Carolina and Tennessee, respectively.

However, Nokia is the first to announce the domestic production of electronics for fiber networks. Its announcement is also significant given the company claims to be the top supplier of fiber broadband technology for U.S. operators.

An official with the U.S. Department of Commerce, which is overseeing the BEAD program, told Fierce Telecom the agency is in conversation with nearly a dozen other broadband vendors about bringing their manufacturing stateside.

“We’re hoping that we will continue to have this steady drumbeat,” the official said. “There’s momentum that’s building with more and more of these announcements…I am confident we will have more.”

Charlie Mason, EVP of Global Sales for Sanmina, said three of Nokia’s products will be incorporated into the manufacturing lines at the company’s existing plant in Kenosha, adding about 200 new jobs. Sanmina will be buying new equipment and tooling to add Nokia’s products into the mix. The optical modules will be produced at a different facility, with additional details on that forthcoming over the next weeks and months.

Buy American rules passed by Congress demand that grant awardees use products and materials that contain at least 55% domestic content. Though a waiver of these rules was granted for the $1 billion Middle Mile grant program, the U.S. government has not waived the requirement for BEAD participants.

The Commerce official explained that’s in part because the timeline for the Middle Mile program “didn’t allow for the ramp up” that was needed to bring production stateside in time for deployments. BEAD, the official said, has a longer timeline and thus production of equipment from Nokia and others should “line up perfectly” grant awards and the timeline for when deployments will start in earnest.

Additional details about the Buy American requirements for BEAD will be released “later this summer,” the Commerce official said.