Ericsson still sees Huawei as a competitive threat in Europe: Report

Despite the EU and U.S. ban on Huawei network equipment, Ericsson still sees the Chinese firm as a major competitive threat in Europe. A new report insights on how the removal of Huawei from the foreign network core is affecting its rivals.

Huawei network equipment continues to face ban processes in foreign countries. The recent one counts Germany in this queue. Regardless, Huawei still appears as a competitive threat to firms like Ericsson in Europe and other regions.

Börje Ekholm – the CEO of Ericsson says that Chinese companies like Huawei and ZTE are still a regional challenge. The executive says so while sharing his quarterly sales revenue results and other details with analysts during a meeting.

“We are seeing sharply increased competition from Chinese vendors in Europe and Latin America. I got the impression over the last few months that everyone thinks Chinese vendors have disappeared and that is not true.” – said Börje Ekholm.

The sales revenue shows that Ericsson fell by 7% this year with $5.7 billion. This eventually resulted in a net loss of $1.1 billion, compared to last year ($56.8 million).

Ericsson still sees Huawei as a competitive threat in Europe (Image Credits: Ericsson)

Ekholm believes that the major slowdown of Ericsson in the network market is due to Chinese firms. Telecom operators in global regions didn’t want to spend much on 5G.

In such conditions, Chinese competitors continue offering affordable products which stops telecoms from being tough on them. The network market is now dealing with a price war and operators are shifting to those with cost-effective products.

Reports from Omdia indicate that Huawei is constantly edging out Ericsson and others from the global RAN market. Ericsson shares fell to 24.3% in 2023 while the Chinese tech giant remained at 31.3%, taking the top position in its hands.

Ekhlom responded to this ranking and said Ericsson requires more discipline to enhance its gross margin. He also states that Huawei’s growth shows that U.S. restrictions have failed. Now it’s time for the telecoms and customers to make a choice.

A previous report said that Germany will take at least 5 more years to remove Huawei equipment from its network core. Even after this long, most network antennas might belong to Chinese firms until 2030. When asked about the German ban, Ekhlom said:

“I think it’s still a bit too early to have a view on what will happen in Europe. I saw the legislation announced and I think we’ll have to see how that impacts the market.”

Germany to ban Huawei 5G equipment by 2026, but will that be easy? (Image Credits: Huawei)

[Source – LightReading]