Newsletter: Q1 2007

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Ericsson has made a robust start to 2007, with net sales of SEK42.2 billion, up 8 percent on last year's first quarter, and net income of SEK5.8 billion, up 27 percent year-on-year. The increase in sales reflects good performance across all business segments (Press release).

Sony Ericsson began 2007 with a very strong first quarter, in which shipments reached 21.8 million phones - a 63 percent increase over the same period last year - generating significant year-on-year market share gains and continuing the momentum of 2006. Sales for the quarter were 2,925 million euros, 47 percent higher than last year's first quarter, while income before taxes was 362 million euros, 139 percent up on a year earlier. The average selling price fell to 134 euros, as the company continued to expand its product portfolio with mid-tier and more competitively priced phones (Press release).

Vodafone has selected Ericsson to manage the supply and distribution of spare parts for its mobile networks across several of its major European operating companies including those in Germany, Spain and Portugal. Under the multi-million euro deal, Ericsson will be responsible for the logistics, warehousing, repair and replacement of multi-vendor spare parts for 2G, 3G and transmission equipment. This is expected to deliver greater cost efficiencies through lower average prices, as well as enhanced service levels (Press release).

Ericsson has received favorable rulings from the relevant competition authorities to acquire all outstanding shares in Tandberg Television. Furthermore, no material adverse change has occurred. Consequently, all conditions in the terms and conditions set out in the offer document, dated 26 February 2007, have been met and Ericsson will complete the offer in accordance with the offer document. As soon as possible following settlement, Ericsson will proceed with a mandatory offer for the remaining shares in Tandberg Television as required under chapter four of the Norwegian Securities Trading Act (Press release).

Carl-Henric Svanberg, president and CEO, Ericsson, says, "IPTV for cable and telecom operators is the biggest networked multimedia opportunity for the future. Ericsson and Tandberg Television is a strong combination with a unique ability to offer complete IPTV solutions. Tandberg's leading TV technology and customer base, and our global presence and strong position in IP networks and IMS, will create a leading player in networked media solutions for telecom, cable and satellite operators as well as media companies."

Turner Broadcasting System International and Ericsson are collaborating to develop Turner's Internet, broadcast news and entertainment content - including CNN International, Cartoon Network and Adult Swim material - for mobile multimedia environments.

The initial product launch, CNN Mobile, and subsequent launches in this collaboration will make technologically advanced multimedia content available to users in two ways. First, mobile operators will be able to deliver simple access to Turner content through their own branded portals; second, subscribers will have access to content such as the CNN Mobile site directly on their mobile devices (Press release).

Over the next five years, we shall see more communications and entertainment innovation than during the past 50 years, and telecoms networks are shaping up to be the next mass-market delivery medium. The introduction of Internet Protocol TV (IPTV) services begins this multimedia transformation - and represents a big money opportunity for telecom operators.

IPTV technology gives operators the opportunity to bundle their current telephony, Internet and mobile services with new TV services to attract new customers and retain existing ones. It puts them in position to transform TV from a one-way, single stream of channels into a two-way communications service that enables interactivity, convenience, entertainment and personalization.

The addressable market for IPTV services is as big as the broadband market itself - which, in another five years, will approach 600 million fixed subscribers and 800 million mobile broadband users. IPTV services may be in their infancy, but analysts anticipate it becoming a mass-market service within the next few years. From a base of 6.4 million in 2006, subscriptions will more than double that during 2007 and reach 48 million households worldwide by 2010, according to Gartner.

As an enabler of 'broadband everywhere' Ericsson sees fixed and mobile broadband connectivity as the basis for multiple revenue streams - especially around broadband delivery of interactive, personalized media. Already, more than 120 commercial mobile TV services have been launched, with more than 100 of these delivered over mobile cellular networks - more than half of which were built by Ericsson.

In this context, IPTV is much more than enabling video streaming over the Internet. While the technology can distribute broadcast TV services in the same way as terrestrial, satellite and cable systems, the real potential for IPTV is in personalization, interactivity, multiple streams, high-definition TV (HDTV) capabilities and the integration of communication and video services.

IPTV also gives consumers more control over what is being watched, when, by whom and how often. This is an important feature, for example, for parents who want to protect their children from inappropriate content and for those who would like to know how much money they're spending individually. By creating personal profiles, individuals can receive their personal selection of channels and opt to receive information and advertisements that interest them.

Rising to the challenge

Delivering high-quality IPTV services means moving from best-effort Internet to high-performance, full-service broadband networks capable of true, two-way multimedia communication with guaranteed quality. It will also mean making it easy to buy, use and manage these services.

The technical demands of delivering interactive HDTV are extremely high, and fulfilling them economically is the next challenge for full service broadband architecture. That's why Ericsson is making significant investments in the technologies needed to deliver its 'broadband everywhere' vision: in multimedia (Tandberg Television); in core IP infrastructure (Redback Networks); in access network technology (Entrisphere); and in the underlying transmission and switching technologies (Marconi).

Ericsson, with its history in delivering real-time, telecom-grade infrastructure, is driving the harmonization of IPTV and related services delivered over broadband with open standards - to ensure rich functionality, telecom-grade scalability and high quality. Ericsson is working with the relevant standardization bodies to achieve economies of scale and interoperability across IPTV and other service reference architecture and interfaces.

In March 2007, Ericsson joined AT&T, France Telecom, Panasonic, Philips, Samsung, Siemens Networks, Sony and Telecom Italia in launching the Open IPTV Forum, which will define an interoperable, end-to-end specification for delivery of IPTV services.

The forum, which is fully open to participation across the communications and entertainment industries, will focus on development of open standards designed to streamline and accelerate deployments of IPTV technologies, and help maximize the benefits to consumers, network operators, content providers, service providers, consumer electronics manufacturers and infrastructure providers.

The Open IPTV Forum aims to aggregate today's diverse standards - including IP Multimedia Subsystem (IMS) and Digital Living Network Alliance (DLNA) - into a complete delivery solution, with the goal of accelerating the full standardization of IPTV-related technologies. With interoperability between consumer equipment and services, users will be able to access content and services from multiple service providers - over fixed or mobile telecoms networks, cable or satellite accesses. The Forum plans to establish requirements, architecture specifications and protocol specifications later this year.

As an open-standard architecture that offers a common control framework for fixed and mobile networks and devices, IMS will help operators deliver converged telephony, Internet, TV and mobile services. It can untie such services from devices, linking them to a user's profile instead.

The next wave of broadband infrastructure development far exceeds the last Internet build-out 10 years ago, and IPTV will help telecom operators make the most of the capacity and capability that it will provide.

You can find more information on Ericsson's IPTV offerings <here>.

This year, 3 billion people will have a mobile phone and Ericsson expects that figure to grow to 4 billion before 2010. For many of these subscribers, the move to true mobile broadband will be a short step. Millions of people already have mobile access to the Internet anywhere, anytime, and the ecosystem for mobile broadband is already in place.

Networks all over the world are being upgraded and users are realizing that the same high-capacity services that, until now, have been available only at home or in the workplace can be accessible from any mobile device. Users are beginning to see the possibilities of mobile broadband - connectivity to any service, anytime, anywhere and on any device.

With more than 100 High-Speed Packet Access (HSPA) networks launched worldwide, WCDMA/HSPA is the preferred network technology for mobile broadband. These networks are complemented by some 125 HSPA-enabled devices, including some 50 HSPA mobile phones.

During the quarter, Ericsson built on its HSPA leadership:

• Síminn, Iceland's largest operator, has awarded Ericsson a turnkey contract to plan, deploy and integrate its WCDMA/HSPA network (Press release).
• Ericsson is rolling out the first HSPA-enabled 3G/WCDMA commercial network in Brazil, for Telemig Celular (Press release).
• Ericsson has been selected by members of the mobilkom austria group to expand and upgrade their WCDMA radio networks with HSPA in Austria, Bulgaria, Croatia and Liechtenstein (Press release).
  

Turkey's leading operator Turkcell has selected Ericsson to expand mobile voice and data traffic capacity and help increase the diversity of services it offers to customers. Turkcell's network has more than 12,000 base stations and provides network coverage to 97.2 percent of the nation's population (Press release).

Following the recent 3GPP industry standardization of EDGE Evolution, Ericsson has restated its commitment to launch the technology as a software upgrade of existing infrastructure by 2009. EDGE Evolution will provide a three-fold boost to data speeds and will significantly improve latency, coverage, and spectrum efficiency. This improved data performance in GSM will serve as an important complement to high-speed WCDMA/HSPA networks (Press release).

Telefónica Móviles subsidiary Movistar, the leading mobile operator in Peru, has rolled out a new nationwide GSM/GPRS radio access network from Ericsson (Press release).

Indian operator IDEA Cellular has signed a three-year contract with Ericsson for GSM expansion in several regions. Under the contract, Ericsson will provide radio access, microwave transmission and next-generation, mobile softswitch architecture for a state-of-the-art EDGE-enabled network (Press release).

Warid Telecom International LLC, Bangladesh Operation (Warid Telecom) has chosen Ericsson to plan, design and integrate an in-building solution (IBS) that will enhance coverage across 43 cities in Bangladesh (Press release).

Australian operator Telstra and Ericsson have implemented the world's first 200km cell in a commercial mobile broadband network, with maximum network downlink speeds of 14.4Mbit/s (Press release).

Grameenphone, the leading operator in Bangladesh, has chosen Ericsson to build and integrate a complete nationwide IP mobile backbone network for the introduction of layered architecture (Press release).

Swisscom has signed a six-year frame agreement with Ericsson for the delivery of an IMS solution, including a converged core infrastructure network and applications, as well as related professional and managed services (Press release).

Ericsson's Femto Cell Solution enables GSM and WCDMA subscribers to use their mobile phones at home with the price advantages offered by fixed-line and Internet phones. The solution incorporates the world's smallest GSM radio base station as well as WiFi and ADSL (Press release).

Ericsson conducted a live demonstration of its Long-Term Evolution (LTE) system with Multiple In/Multiple Out (MIMO) antenna technology at speeds of up to 144Mbit/s at the 3GSM World Congress in Barcelona in February (Press release).

Ericsson conducted the world's first live demonstrations of Mobile TV using its Multimedia Broadcast Multicast Service (MBMS) at 3GSM World Congress. MBMS facilitates mobile broadcasting of multimedia services, including Mobile TV, over existing 3G networks (Press release).

Indian mobile operator IDEA Cellular, Ericsson and the GSM Association have teamed to develop biofuels as a source of power for mobile networks in rural India. In a pilot project in Pune, Maharashtra, the three organizations will begin using biofuels to power mobile base stations located beyond the reach of the electricity grid (Press release).

Telefónica España has selected Ericsson's mobile TV solution to provide consumers with easy access to rich mobile TV content and services. Ericsson will provide Telefónica España with the world's fastest channel selector, which provides one-click channel switching from the mobile handset, as well as an easy-to-use Electronic Programming Guide (Press release).

The world's first trial of personalized mobile TV advertising, conducted by Norwegian Broadcasting Corporation (NRK) and Ericsson has earned a positive response from consumers. The three-month trial found the average click-through rate reached 13 percent, and the average viewing time of each mobile TV user more than doubled - to seven minutes per session - when users interacted with customized ads (Press release).

Vodafone Iceland has selected Ericsson to deliver an end-to-end IPTV solution and systems integration services. The integrated solution will be the first step in the evolution toward converged multimedia services based on Ericsson IP Multimedia Subsystem (IMS) (Press release).

Vivo has selected Ericsson's Service Delivery Platform (SDP) to provide a range of consumer multimedia applications in Brazil (Press release).

Ericsson has started volume shipment of its E310 mobile platform, one of the smallest EDGE mobile device platforms on the market today. Its optimized size and performance give device manufacturers greater freedom in industrial design and mechanical engineering, enabling stable and high-quality volume production. The E310 combines a state-of-the-art EDGE chipset and a common software architecture platform and enables original equipment and design manufacturers (OEMs and ODMs) to leverage and scale their investments across their complete portfolios, from EDGE to HSPA, which is unique in the industry (Press release).

Leading wireless ODM Compal Communications has signed a license agreement with Ericsson for its U310 triple-band WCDMA mobile platform. The U310 is an advanced WCDMA/EDGE/GPRS platform designed for true mass-market deployment. It incorporates a flexible quad-band EDGE and triple-band WCDMA radio solution, enabling the design of mobile devices for the global market (Press release).

Ericsson has launched a new HSPA embedded module that enables built-in mobile broadband in notebook computers and other device. The new HSPA module will support all mobile standards: HSPA, EDGE, GPRS and GSM. For HSPA, it will offer 7.2Mbit/s in the downlink and 2Mbit/s in the uplink (Press release).

LG Electronics has signed a license agreement for the Ericsson U360 HSPA mobile platform. The U360 has the highest level of silicon integration and lowest power consumption in the industry, enabling handset manufacturers to launch ultra-small HSPA phones for the mass market. It provides 3.6Mbit/s HSDPA and an advanced radio solution with tri-band WCDMA, as well as quad-band EDGE/GPRS, enabling truly global handsets (Press release).

Ericsson will provide China Netcom's Beijing Branch, Beijing Netcom, with the country's first commercial IP Multimedia Subsystem (IMS)-based network. Under the agreement, Ericsson will be the sole supplier of the IMS multimedia telephony system, which will provide value-added services including IP-Centrex for enterprise customers (Press release).

Uruguay's leading telecom operator Antel has chosen Ericsson microwave and optical networking solutions to implement a flexible, scalable and cost-effective transport network for fixed and mobile services. This will able Antel to offer a wide range of services and meet demand for network capacity, driven by increasing subscriber numbers and the uptake of new data services (Press release).

Telekomunikacja Polska (TP) is to deploy Poland's first IMS IP-telephony solution, under a contract that will see Ericsson integrate the solution into TP's network and provide support and maintenance. IMS will enable TP to deliver enriched multimedia services to consumers and enterprises, including multimedia telephony, presence, instant messaging and IP-Centrex services, over fixed or mobile broadband access (Press release).

Ericsson has joined AT&T, France Telecom, Panasonic, Philips, Samsung, Siemens Networks, Sony and Telecom Italia to form the Open IPTV Forum, an industry consortium that will work to define an interoperable end-to-end specification for the delivery of IPTV services (Press release).

Finnish regional telephone company Päijät-Hämeen Puhelin (PHP) has rolled out Ericsson's EDA VDSL2 solution to offer its broadband customers triple-play services combining IPTV with voice and data (Press release).

Telecommunications services are Ericsson's fastest growing area of business, achieving more than 30 percent growth during 2006 and more than 10 percent market share. Today, Ericsson manages networks covering 100 million subscribers and provides round-the-clock technical support to operators with more than 1 billion subscribers.

Ericsson has been awarded two hosted service contracts - for prepaid services and ringback tones - by SunCom Wireless, a leading wireless phone service provider in the southeast of the United States, Puerto Rico and the US Virgin Islands (Press release).

Dobson Cellular Systems, the largest independent provider of mobile services to rural America, has selected Ericsson to host a full range of new features and flexible rate plans, including ringtones, wallpaper selections and downloadable games, for its Cellular One prepaid subscribers (Press release).

Greek city Trikala has selected Ericsson as total solution provider for the creation of the first Greek Digital City. Ericsson is the prime integrator for this turnkey FTTx backbone telecommunications infrastructure project, which will bring broadband services to the population. Ericsson is also the sole supplier of switching, WiFi systems and a metropolitan area fiber optic network, as well as related telecom services, such as consulting, deployment, systems integration and customer support, until 2008 (Press release).

Spanish mobile operator Telefónica Móviles España has selected Ericsson as prime integrator for an end-to-end mobile signature service that will support secure authentication for web log-ins, remote access and the digital signing of transactions and documents (Press release).

Belgian operator Mobistar, a member of the France Telecom group, has awarded Ericsson a five-year, Euro 300 million managed services contract. About 150 employees are to be transferred from Mobistar to Ericsson (Press release).

Leading Greek mobile operator Cosmote has launched Ericsson's hosted music service solution for mobile operators. The new service is a white-label service branded as Music Zone (Press release).

Finnish operator Elisa has awarded Ericsson two content hosting deals - one for music and content downloads, and one for mobile TV (Press release).

The new X-Series services from UK operator 3, developed in partnership with Ericsson, mark a turning point in mobile services: making popular Internet applications available on mobile handsets. The X-Series includes services from Skype, Sling, Orb, Yahoo!, Microsoft Windows Live Messenger, eBay and Google (Press release).

Mobile operator Orange has chosen Ericsson for a five-year managed services cooperation in the Netherlands, covering operations, roll-out and field maintenance. Under the deal, 190 jobs will be transferred to Ericsson (Press release).

Ericsson's new Enterprise Multimedia Server offers companies a fast, cost-effective way to roll out user-centric unified communications with Ericsson Mobile Extension support. By putting users at the center of communication with a single point of contact, the system enables them to keep in touch wherever they are, using their preferred available device and network (Press release).

Ericsson's new generation Enterprise Mobility Gateway offers enterprises and network operators an open integrated solution for a full range of mobile enterprise services. The system will initially provide mobile voice and data services, fully integrated with the corporate communications network, on 2G/3G mobile devices as well as dual-mode mobile/WiFi devices (Press release).

A 35 percent improvement in the energy efficiency of Ericsson 3G radio base stations during 2006 is a highlight of Ericsson's latest annual Corporate Responsibility Report, Driving Change and Building Trust. The report details the company's environmental, economic and social commitment and performance during 2006. By the end of 2008, Ericsson's continued improvements to 3G radio base stations will result in an overall energy-efficiency improvement of 80 percent for the total product mix compared with 2001 (Press release).

Ericsson has acquired Mobeon AB, the Stockholm-based leader in IP-messaging components for mobile and fixed networks. This deal represents another step in Ericsson's strategy to become the leader in multimedia. Twenty-one percent of Mobeon is already owned by Ericsson, which is also the primary partner and original developer of Mobeon's CompEdge series of carrier-class messaging solutions (Press release).

Ericsson has acquired Santa Clara, USA-based fiber access technology company Entrisphere to strengthen its fixed broadband access portfolio and its position in converged networks. Fiber technology is essential for High Definition IPTV and other IP-based services that have high demand on bandwidth and cost efficiency (Press release).

Adopting the managed services concept can help operators reduce costs and increase competitiveness (White paper).

An optimized selection of specified system service performance indicators will increase the ability to guarantee user-perceived service performance (White paper).

Basic concepts of HSPAIMS is the only standardized way to deliver IP-based services enabled by a single common core and control for all types of networks. It provides users with attractive, communication services, over multiple devices across multi-access technologies (White paper).

HSPA is a vital part of WCDMA evolution and provides improved end-user experience as well as cost-efficient mobile broadband (White paper).

Different services have different demands and require different approaches (White paper).

EDGE Evolution will introduce higher data rates and improved coverage, further strengthening GSM/EDGE as an attractive mobile broadband solution and complement to HSPA (White paper).

For the latest Ericsson white papers, please click here

The latest issue of Ericsson Business Review, Ericsson's thought-leading magazine on business strategies in telecoms, leads with a piece on the continuing attractive business case for offering broadband access as a service in itself. There are also articles on the latest broadband consumer research, mobile family plans and operator enterprise service opportunities, as well as a case study of Portuguese operator Optimus's mobile broadband strategy. To view the latest issue and to subscribe, please click here.

May 7-11
Transport networks for mobile operators
Corinthia Grand Hotel Royal, Budapest, Hungary

Tuesday, May 8
The road to all-IP
Speaker: Aldo Bolle, Strategic Product Manager Broadband Networks, Ericsson

May 22-24
LTE 2007
Berlin, Germany
Website

Tuesday, May 22
Which spectrum should be deployed for LTE?
Speaker: Ericsson representative TBA

June 4-8
Billing & Information Management Systems 2007
Olympia 2, London

Wednesday, June 6
Convergence
Chairman: Niclas Melin, Marketing Director Revenue Management, Ericsson

 

Thursday, June 7
Lessons learned from IMS deployment
Chairman: Stefan Wallin, Strategic Portfolio Manager Revenue Management, Ericsson

June 5-8
Broadband World Forum Asia
China World Hotel and China World Trade Center, Beijing, China

Thursday, June 7
Delivering IPTV, Internet Video over a Converged IP Infrastructure
Chairman: Young-Sae Song, Director Corporate Marketing, Redback Networks
Panel Member: Ericsson representative TBD

 

Thursday, June 7
Home Network Anywhere Anytime
Chairman: Krister Boman, Product Manager, PDU Packet Core, Ericsson

 

Friday, June 8
Full-Service Broadband Network Architectures
Chairman: Peter Linder, Director Network Strategy, Ericsson

June 18-21
FTTx Summit
Arabella Sheraton Grand Hotel, Munich, Germany

Wednesday, June 20
Deployment strategies for hybrid and pure fiber networks
Speaker: Rene van Workum, Sales Manager, Broadband Access, Ericsson

June 18-21
NXTcomm, Booth no 4151
McCormick Place, Chicago

June 19-22
CommunicAsia
Singapore Expo

June 25-29
WDM & Next Generation Optical Networking
Hilton Cannes

Monday, June 25
Different technology approaches to Reconfigurable Optical Add-Drop Multiplexing (ROADM) and their cost-performance implications
Speaker: Richard Dorward, Photonics Product Strategy Director, Ericsson

September 3-7
African Telecoms Billing And Revenue Management Forum
Cape Town Convention Centre, Cape Town, South Africa

Date TBC
Using revenue management to maximize network usage on high-growth markets
Speaker: Niclas Melin, Marketing Director Revenue Management, Ericsson

September 24-28
Prepaid World
Corinthia Grand Hotel Royal, Budapest, Hungary

Topics and speakers to be announced

May 9: Capital Markets Days
Annex to the Globe Arena, Globentorget, Stockholm
Speakers: Carl-Henric Svanberg, President and CEO and other senior managers

May 10: Technical Seminars
Ericsson Headquarters, Torshamnsgatan 23, Kista, Stockholm
Website
See website for details of live webcast.

May 11: CSFB European Technology conference,
London
Speaker: Karl-Henrik Sundström, Executive Vice President and CFO

July 20: Q2 2007 results

September 11: Strategy and Technical summit, London

October 25: Q3 2007 results

November 20: Management Briefing, New York 

For further information about industry analyst activities, please contact industry.analysts@ericsson.com or refer to our website.

May 2: Revenue management

May 3: QIB and IMS update

May 30: Long Term Evolution

June 13: Communication for all - Ericsson Expander

Please note: these topics were correct at the time of sending this newsletter. Please check here regularly for an updated list of scheduled telebriefings.

If you missed a telebriefing or would like further information, check out the archive where you can listen to the telebriefing, and access the presentation and script here.

To sign up for the industry analyst telebriefings and technology updates, please send an e-mail to industry.analysts@ericsson.com or refer to our website.

The next newsletter will be issued following the quarterly report on 20 July 2007. For further details regarding the quarterly reports, please check here.

To sign up to receive Ericsson press releases, please click here.

Don't forget to check out the industry analyst web site http://www.ericsson.com/ericsson/industryanalysts

If you would like further information about any stories in this newsletter, or to arrange a briefing, please send an e-mail to industry.analysts@ericsson.com. Ericsson's global industry analyst relations team are: Eva Sparr (Global, North America), Frank Puglia, (North America), Rob Elston (Europe/Middle East/Africa) or Eva E Andersson (Asia Pacific). Please contact the person responsible for activities in the region in which you are based.

A special thanks to those who responded to our recent survey to assess Ericsson's methods for communicating with industry analysts. The winners of the Sony Ericsson W950i devices were Annette Zimmerman of Gartner and Brendan Conroy of IDC.