Ericsson China 4 g author is expected to trigger a fierce price war

Beijing time on May 3, the evening news, Ericsson is expected, as China’s operators to start building high-speed 4 g mobile broadband network, the competition between the telecom equipment maker is heated, it will cause the telecom equipment maker already tight margins face further pressure.

in the past 10 years, China’s manufacturers such as huawei and zte launched a long price war, this led to companies such as nortel and MOTOROLA was forced to withdraw from the telecoms equipment market, while companies such as alcatel lucent had sustained losses.

telecom equipment maker common hope, later this year, Chinese operators will ease on construction of 4 g LTE network industry current problems we are facing. But the end result may be disappointing. Deployment of new network across the country in China means more hardware requirements, rather than the software requirements. Relative to the upgrade of the current network projects, this new network project profit margins often is not high.

Ericsson network director John webb (Johan Wibergh) said: “the deployment of LTE networks is a new class project. There is no doubt that we know cover class project profit margins low.”

three carriers in China, including China mobile, China unicom and China telecom this year is expected to be spending a total of 345 billion yuan ($56 billion), used in the current network upgrades and 4 g network construction. Among them, China mobile plans spending 41.7 billion yuan this year, the deployment of 200000 4 g base stations, provide 4 g services to 710 million users.

Mr Webb said, such a flagship project will lead to the fierce competition between vendors, and local Chinese giant huawei and zte will also participate in the competition. But he believes that the market outside China, the price pressure is alleviated, and Ericsson in 2012 small increase the product price. Troubled telecom equipment maker currently don’t have much ability to continue to initiate price war against profit margins.

he said: “I think the worst is over, all people in the industry needs certain stability.”

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of sina science and technology