Out of 140 5G networks currently operational worldwide, Ericsson is present in 85 of them. This does not prevent the Scandinavian manufacturer from aiming higher.
Well engaged in the race for 5G, Ericsson is looking to China, from where the threat could arise. The Swedish manufacturer has indeed published on Monday an update of its risk factors, issuing an unsecured bond of 500 million Euros at 8 years.
At issue the weakening of relations between Sweden and China, which could hamper its growth. Stockholm has in fact banned the Chinese flagships Huawei and ZTE from participating in the deployment of 5G networks on its territory in October 2020, while pushing national operators to eliminate the presence of the two giants on their networks by 2024.
What push Beijing to take retaliatory measures vis-à-vis Ericsson? This is what the manufacturer's staff fears. "Although Ericsson is invited to participate in various ongoing tenders in China, the final outcome remains uncertain and the risk that Ericsson will be assigned, in these tenders, a significant market share lower than its current market share, increases, "said the management of the equipment manufacturer.
Ericsson and Samsung make peace
While the risk of losing market share in the huge Chinese market is real, Ericsson is also under threat from competition. Good news for the manufacturer, it has just concluded an agreement with the Korean giant Samsung to put an end to litigation relating to patents in the field of cellular technologies.
Ericsson had filed a complaint at the beginning of the years against Samsung, accusing the Asian giant of having infringed patents relating to network equipment ranging from cellular communications towers (antennas, radios, base stations) to basic network products that are connect wirelessly to cell phones and other cellular equipment. The agreement, announced in recent weeks, should allow the two companies to normalize their relations while allowing Ericsson to secure its license revenues, which are expected to amount to more than 200 million euros in the second quarter of 2021.
Enough to guarantee Ericsson to retain a prime place in the 5G race ... Provided that all countries and operators play the game. Out of 140 5G networks currently operational around the world, the equipment manufacturer is present in 85 of them, is satisfied for the moment the president of Ericsson France Franck Bouetard. In France, the Scandinavian giant operates on the networks of Orange and Bouygues Telecom, its two historical partners.
Brussels and Paris called to redouble their efforts
Already a candidate for calls for tenders launched by French operators to equip their cores with 5G networks by 2022 or 2023, the Scandinavian manufacturer however calls on France and its European neighbors to get in tune with the world champions of 5G that are South Korea, China or the United States so as not to be left behind in the coming years. "We are late," warns the president of Ericsson France, interviewed by ZDNet France.
"While China has 2.3 million 5G base stations against 110,000 for the United States, France has 2,800. We must absolutely accelerate so as not to be left behind in the next decade, it is for the economic success of France and the entire European Union, "said the leader. However, he applauds the emergence of "French political voluntarism which should enable us to move forward".
And to point out the importance of the role that 5G must play in supporting the deployment of very high speed throughout France. "5G is a natural candidate for the completeness of very high speed networks", notes Franck Bouetard. "Fiber should be reserved for very dense areas, where it makes a lot of sense. When we go through low density areas, fiber is not the most relevant technology to connect the less isolated areas. There, it is worth make better use of radio technology, whether 4G or 5G, "he explains.
A key role for very high speed
For the latter, the gradual rise of 5G over the next few years should contribute to placing cellular connectivity at the center of the game. And it is not the imminent arrival of satellite players like Starlink that is likely to slow this down ascent to the summits, he believes. "Satellite solutions cannot compete, both in terms of cost and in terms of speed. We do not see it as a competing technology but as a complementary technology for areas that cannot be covered, such as the oceans for example."
And if fiber is called to play the leading roles in the connectivity of the French, 5G will obviously have a say. Especially since, "from an environmental point of view, 5G consumes less than fiber", underlines the president of Ericsson France from there to replacing connectivity via Wi-Fi in the coming years? “It is obvious that when 5G is deployed, it will lead to an explosion of data capacities and therefore significantly reduce the traffic passing through Wi-Fi. People will no longer connect to their Wi-Fi hotspot. There will be a certain substitution, which will include both complementarily and competition,” he believes.
While the coming decade will be that of 5G, Ericsson is already preparing for the future by participating in the development of the future 6G within the various international initiatives working on the subject . However, "we must not hurry and do things in order. We are only at the beginning of a long process of sketching out what 6G will be and what needs it will have to meet. Priority goes to 5G because there is an emergency, ”notes Franck Bouetard.