Ericsson’s top executive has vowed to step up efforts to regain market share lost in China after Sweden blocked Chinese suppliers from its 5G roll-out.
China accounted for about 10% of Ericsson’s revenue last year, but that fell sharply after the company’s home country of Sweden banned Huawei from its 5G networks, citing security risks – a charge that Huawei has strongly denied.
“We have been in China for 120 years and I don’t intend to give up easily,” Chief Executive Borje Ekholm said in an interview with Reuters. “We are going to show that we can add value to China.”
Ericsson had lobbied the Swedish government in favour of Huawei, warning of possible retaliation by China, but the ban went through and has been upheld in court.
Analysts had warned that Ericsson, based in the Swedish tech hub Kista north of Stockholm, could lose a majority of its China business with contracts going to Nordic rival Nokia.
But while Finland’s Nokia, which didn’t get any radio contracts in China last year, landed its first one in the second round of awards, Ericsson has been able to retain a slight edge so far.
“If we had lost out completely then it would have put us at a competitive disadvantage from a technology point of view,” Ekholm said.
China has been at the forefront of deploying 5G networks and accounts for more than half of the equipment used globally, making it a critical market for any telecom equipment maker.
Beyond the vast sales volumes, being a front runner means China provides a test bed for advanced 5G technologies which Ericsson and Nokia could tap into when deploying networks across the world.
- Reuters and Sean O’Meara