Ericsson Takes Home Massive Chinese Orders

Ericsson has signed two massive orders worth a combined $1.8 billion from China Mobile and China Unicom, according to a statement from the Swedish telecom company.

Ericsson said it had won a $1 billion contract with China’s top operator China Mobile to provide it with equipment to “dramatically boost the capacity of the network and evolve it into an IP network.”

The Swedish company had also agreed to provide China Unicom with a faster 3G network, and to supply IP routers, fibre access and other technologies worth $800 million.

Both contracts will be fulfilled during the course of the year.

“With a potential customer base of 1.3 billion, telecom operators are now taking steps to further expand and boost China’s communication infrastructure and related services,” Ericsson said.

In 2009, China counted 747 million mobile subscriptions, an increase of 106 million from a year earlier, Ericsson said, adding that “there is no sign of the market cooling down.”

“A steadily rising number of the Chinese population is going mobile…. Today, 99 percent of the population has mobile coverage, thanks to operators’ recent network expansion to rural areas,” Ericsson said.

“We are confident that we will do an even better job in supplying the latest technology and best-in-class services in time to support Chinese operators in fulfilling the demand of this tremendous market growth,” Mats Olsson, who heads up Ericsson’s Greater China division, said in the statement.

The contracts announced Monday follow on the heals of Ericsson’s similar equipment deals with the same operators last July worth $1.7 billion.

Following the announcement, Ericsson saw its share price jump 1.8 percent on the Stockholm stock exchange, which as a whole was up 0.5 percent.


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