Chinese Huawey Beat Swedish Ericsson on Telecom Equipment

Huawei Technologies Co Ltd, Chinese global information and communications technology (ICT) solutions provider, has become the world’s biggest manufacturer of telecom equipment, after its first-half revenue beat that of Swedish rival Telefon AB LM Ericsson.

Huawei reported on 24 July 2012 that its first-half revenue was 102.7 billion yuan ($16.07 billion), up 5.1 percent year-on-year. The figure is $850 million more than that of Ericsson’s first-half revenue.

However, analysts said that Ericsson is still by far the largest cellular infrastructure maker in the world. The Stockholm-based company has developed a business portfolio different from that of Huawei and is strengthening its position in the telecom service market.

“Ericsson holds the No 1 position in mobile network infrastructure and telecom services,” Melody Li, a spokeswoman for Ericsson China, told China Daily on Wednesday. She said that Ericsson’s market share in the mobile equipment market reached 38 percent with $34.9 billion in 2011, twice as big as its closest competitor in the segment.

Huawei held 16.5 percent of the world market for mobile network infrastructure in 2011, bringing in $13.5 billion in revenue, according to Gartner Inc.

“The situation did not change much this year, which means Ericsson still dominates the market,” said Xiang Ligang, a telecom expert in Beijing. He added that Ericsson gained an upper hand over Huawei because it has full access to the North American market, while Huawei was blocked from this profitable region due to security concerns by the US government.

Ericsson also drew back from the mobile phone business after selling its 50 percent stake in Sony Ericsson Mobile Communications AB, a 10-year-old mobile-phone joint venture with Sony Corp, back to Sony in October 2011.

By contrast, Huawei has sizable handset and enterprise businesses. Huawei’s smartphone shipments soared 500 percent to 20 million units in 2011. Total mobile phone shipments hit 55 million units, according to its annual report.

Leave a Reply

Your email address will not be published. Required fields are marked *