DUBAI: Ericsson, the Swedish telecommunications firm, expects growth in its Middle East business driven by anticipated take-up of 5G wireless technology by consumers and businesses, one of its regional directors said.
“5G is the core of our business strategy and we’ve increased our [5G-related] research and development funding quite significantly since our new CEO took over,” said Ekow Nelson, a managing director for Ericsson’s partnership with UAE telco Etisalat, and head of Ericsson Pakistan, report agencies.Globally, the past quarter was “one of the best we’ve had in the last three years or so – the company has turned around and that’s really because of the investment we’re making in 5G”, he added, in an interview with The National.
Ericsson swung to a quarterly operating profit of 4.9 billion Swedish kroner (Dh1.94bn) in the three months of this year from a 312 million kroner loss a year ago. Sales rose to 48.9bn kroner – beating analysts’ forecasts due to solid growth in the US – and the Stockholm-listed company’s shares rose more than 3 per cent to a four-year high when it reported the results in April.
In January 2017, a new chief executive, Börje Ekholm, took the helm as president and chief executive of Ericsson, and the company has since ramped up its investment in fifth generation (5G) technology, which is expected to transform telecoms and other industries in the decades ahead. In 2017, Ericsson spent around $4.5bn on 5G-related research and development.
5G is a high-frequency wireless network enabling data capacity of up to 10 gigabits per second, compared to 100 megabits per second for the current 4G - or LTE - network.
Today, the majority of internet-connected devices are connected via 2G and 3G technologies, and some through 4G, but 5G networks are expected to carry 35 per cent of mobile data traffic globally by 2024, with 1.9 billion 5G subscriptions predicted by the end of that year, according to Ericsson’s 2019 Mobility Report published last week.