U.S.-led scrutiny of Huawei Technologies Co. should have been good news for its two biggest competitors in the telecommunications-equipment business, Finland’s Nokia Corp. NOK -1.56% and Ericsson ERIC -0.10% AB of Sweden.

It isn’t turning out to be so simple.

Major European wireless providers—big customers of all three—say Nokia and Ericsson have been slow to release equipment that is as advanced as Huawei’s.

Nokia and Ericsson also face a new, deep-pocketed challenger in Samsung Electronics Co. , the South Korean smartphone giant that is aiming to quickly grow its nascent cellular-infrastructure business.

And there is another big pitfall for the two: Both Nokia and Ericsson fear that if they are seen trying to take advantage, Beijing could retaliate by cutting off access to the massive Chinese market, people familiar with the matter said.

Nokia Chief Executive Rajeev Suri, center, at the company’s annual meeting in Helsinki, Finland, in May. Photo: roni rekomaa/epa-efe/rex/shutter/EPA/Shutterstock

In recent years, Huawei has surpassed the Nordic companies to become the world’s biggest maker of cellular-tower hardware, internet routers and related telecom equipment. For the first three quarters of 2018, Huawei had a 28% share of the global telecom-equipment market, Nokia had 17% and Ericsson 13.4%, according to research-firm Dell’Oro Group. That compares with market shares in 2017 of 27.1% for Huawei, 16.8% for Nokia and 13.2% for Ericsson.

Huawei has dominated the world-wide industry despite being essentially barred from the U.S. over concerns that Beijing could order Huawei to spy on or disable communications networks. Recently, the U.S. has been urging allies to enact similar bans.

Governments and wireless providers in Australia, France, New Zealand and other countries are avoiding Huawei after saying the concerns are legitimate. Huawei says it is employee-owned and has never done espionage or sabotage on behalf of any government.

The detention of two Canadian citizens in China and unexpected comments from President Trump have magnified the political stakes of the case involving Huawei executive Meng Wanzhou. Photo: The Canadian Press via AP

Major European wireless carriers that already use Huawei say switching to a different company would add both costs and complexity, since it would require training people to deal with different technology.

Executives at one major British wireless carrier say Huawei can deliver products nearly a year before Nokia and Ericsson can offer hardware with comparable technology. They said they were telling U.K. officials, who plan to decide by spring 2019 whether to exclude major Huawei equipment from the country, that blacklisting Huawei could delay by nine months the U.K.’s launch of 5G, the coming generation of superfast wireless technology.

A Nokia spokesman said the Finnish company is already selling cutting-edge technology in leading 5G markets, including the U.S., and has the advantage of being able to sell its products “to the entire global market.”

An Ericsson spokesman said the company is focused on providing the best products and that “the competitiveness of our technology is what matters.”

A solution architect for Ericsson AB, Fedor Maas, left, used a model truck to help explain the Swedish network equipment maker’s 5G mobile data service at its Hasselt, Belgium, campus in January. Photo: Dario Pignatelli/Bloomberg News

The two Nordic providers, though, come with something Huawei now lacks—a seal of approval from much of the West’s national-security establishment. Nokia and Ericsson representatives have advised the U.S., Canadian and British governments over cybersecurity issues, according to people familiar with the matter, who say the talks are part of normal government relations. In the U.S., conversations have involved giving technical advice to authorities, including congressional intelligence committees and the National Security Agency, people familiar with the matter said.

Nokia has long had a relationship with U.S. national-security officials, which in 2015 formally reviewed the Finnish company during its acquisition of French rival Alcatel-Lucent. As part of that merger, Nokia bought Bell Labs, the famous New Jersey research center that does sensitive U.S. government work.

Leaders at both companies have been careful not to publicly pile on against Huawei, according to people familiar with the matter. Nokia and Ericsson are competing to be the top supplier in their industry in China, which promised about 30% of its telecom-equipment market to European companies as part of a 2014 settlement with the European Union, according to people familiar with the matter.

About 12% of Nokia’s 2017 telecom-equipment revenue of 20.5 billion euros ($23.5 billion) came from its Greater China region, which includes Hong Kong, Macau and Taiwan. An Ericsson spokesman said 7% of Ericsson’s 2017 revenue of 201.3 billion Swedish kronor ($22.3 billion) came from China.

Nokia’s telecom-equipment business now has six research-and-development centers in China and more than 50 offices spread over megacities and provinces in the country. As of the end of 2017, Nokia and Ericsson each had an equipment-manufacturing site in China.

In 2017, Nokia’s telecom-equipment business had about 15,000 employees in its China region—about double its Finnish head count. Ericsson has 12,000 employees spread across its northeast Asia region, which includes China, Japan, South Korea and Taiwan.

Lawyers for Huawei, in a challenge to U.S. anti-Huawei measures, said in an August filing with the Federal Communications Commission that Western telecom-equipment giants all had major operations in China, too.

Nokia responded in an FCC filing that amounts to its only public criticism of Huawei. Brian Hendricks, a former congressional staffer who heads Nokia’s U.S. government-relations office, wrote that Nokia had never been suspected of participating in cyber espionage, intellectual-property theft or evading major international sanctions. “The same cannot be said of Huawei,” Mr. Hendricks wrote.

—Drew FitzGerald contributed to this article.

Write to Stu Woo at Stu.Woo@wsj.com