Ericsson investing in manufacturing and R&D for 5G
When Ericsson reported its Q2 financials last month, company executives detailed a 1% year-over-year decrease in total sales, although the networks segment saw a 2% increase year-over-year with North American (U.S.) operators investments in 5G driving that growth..
President and CEO Börje Eckholm said the uptick in networks came from operators prepping to upgrade networks in the U.S. “Customers turn to new technology in order to manage growing demand for data with sustained quality and without increasing costs. This, together with fixed wireless access, represent the first business cases for 5G.”
Now, to better support operator efforts as well as service its largest market, Ericsson said it will increase its investment in the U.S. following a two-fold approach: “Increase research and development work done close to customers in the U.S. and…increase flexibility to shorten the timeline for new product introduction and product deliver to customers,” according to the network infrastructure vendor. Ericsson also expects to produce 5G radios in the U.S. by the end of the year.
“The United States is our largest market, accounting for a quarter of Ericsson’s business over the last seven years,” Eckholm said in a statement. “To serve the demand of these fast-moving service providers, we are strengthening our investment in the US to be even closer to our customers and meet their accelerated…deployment plans.”
All four Tier 1 U.S. carriers have well-articulated 5G plans with Verizon and AT&T both working toward commercial service launches later this year. Sprint and T-Mobile US have both detailed individual plans to deploy next-generation networks, although U.S. leadership in 5G has been a major talking point as executives from both carries work to gain regulatory approval for a proposed merger that would shrink the domestic carrier market from four players to three.
In December last year, Ericsson won a deal with Verizon to provide the equipment needed to deliver high-speed residential broadband in what is poised to be the first commercial 5G deployment in the U.S. Ericsson will provide pre-standard 5G solutions covering the radio access network (RAN), core, transport and support services, according to the company.
