Improve your bottom line

With seven IMS contracts, six for managed services, and several successful multimedia projects under way, Ericsson is maintaining a strong position in this highly saturated market.

The region that includes Germany, Switzerland, Belgium and the Netherlands is home to some of the world's biggest operators, such as Vodafone, Deutsche Telekom, France Telecom, KPN, and Telefónica. All are strong players searching for new ways to generate income to offset declining voice revenues.

Jens Karolyi, vice president of Marketing and Communication for Market Unit Northern Europe at Ericsson, says that Mobile Virtual Network Operators (MVNOs) have pushed prices down, especially in Germany, forcing traditional telecoms to look for innovative solutions.

Karolyi says: "Ericsson is probably the only vendor today that has the end-to-end portfolio needed to help operators navigate in this environment. We can help them expand their backhaul capacity, which is very important when data traffic is increasing, and we have the latest technology in place, for example in High-Speed Packet Access (HSPA), where we're leading in contracts."

Mobile broadband is becoming a widely adopted standard, and operators are investing in HSPA to make sure they offer the highest-quality service possible, says Tobias Ryberg, a telecom analyst at Swedish research and consulting firm Berg Insight.

"By optimizing their networks, operators will benefit in the long run, so we should expect more such investments going forward," Ryberg says.

Mobile broadband allows operators to bring broadband to rural areas that have not yet received fixed broadband. Operators on the fixed side, on the other hand, use Ericsson technology to offer triple-play, in direct competition with cable and satellite operators.

In 2006, Deutsche Telekom chose Ericsson as its prime supplier to expand its broadband network, using ADSL2+ and VDSL2 technology to bring high-speed internet to German households that had not previously had broadband connection. On October 8, Ericsson announced a contract to deploy VDSL2 in 50 additional German cities served by Deutsche Telekom.

This will allow the operator to expand its IPTV services, with the goal of signing up 1.5 million customers by 2010.

Ericsson is also driving the development of IP Multimedia Subsystem (IMS) with the  recent establishment of an IMS competence center in Berne, Switzerland. The center will bring together application developers and operators to create attractive multimedia services for the IMS platform.

The development and commercial marketing of multimedia services is beginning to show real results on operators' income sheets. Vodafone, for example, reported company-wide, organic non-messaging data revenue growth of 32 percent during the quarter ending June 30, 2007.

"Operators today expect more from fewer vendors," Karolyi says. "At Ericsson, we help operators cut costs and, more importantly, drive revenue to improve their bottom line."