Ericsson expects growth to return in India as private telcos kickstart 4G, 5G network expansion: Andres Vicente

Ericsson Ericsson

Swedish telecom equipment manufacturer Ericsson expects growth to rebound in India after four quarters of decline, as private telecom operators, including debt-laden Vodafone Idea, embark on a network expansion spree, a senior executive said.

“Both Jio and Airtel are continuing to expand the 5G infrastructure, and Vodafone Idea is also catching up and has announced plans for both 4G and 5G. With all these put together, India will see steady 5G growth,” Andres Vicente, Senior Vice President, Market Area South East Asia, Oceania & India, told Moneycontrol in a first interaction after taking over the role earlier this year.

Ericsson has been reporting a steep decline since the last quarter of the 2023 calendar year due to lower 5G spending. India’s revenue contribution towards the company’s overall revenue fell to 5 percent in the July-September quarter from 13 percent a year ago.

“If you compare 2024 versus 2023, the decline is significant. But 2023 was a peak year of deployment. India is second to none for Ericsson,” he said, adding India will continue to be the second-largest market by revenue contribution.

On the latest deal with Vodafone Idea, the executive said the telco remains a “key” partner, and Ericsson continues to be interested in their transformation journey. “That’s reason why we had a network agreement with them.”

The Swedish telecom gear maker said it is ready to quickly supply Vodafone Idea with 4G and 5G equipment from its Pune factory. “Whatever is required in India is served through our local factory.”

On the ongoing level playing field issue between terrestrial and satcom services, Vicente said: “There is a logic in what telcos are saying about level playing field..satcom services are more complimentary than competitive. If you look backwards, the Indian Government has already proved that they have been very effective in regulating everybody, and they are ahead of the game in telecom development, especially in 5G. So I'm sure they will use that judgment to solve this issue.”

Reliance Jio, through separate communications with Trai and Communications Minister Jyotiraditya M Scindia, expressed “significant concerns” over Trai's latest consultation paper on the spectrum assignment for certain satellite-based services, highlighting the need for a spectrum assignment policy that ensures transparency, fairness and competition.

India will continue to be an important market due to the revenue potential for the local operation, which is seeing increased investment in research and development (R&D). The company has set up a new R&D team to focus on network APIs at its centre in Bengaluru.

Ericsson’s engineering teams at R&D sites in Chennai, Bengaluru, and Gurugram work on telecom technologies, including transport, packet core, OSS/BSS, and cloud and AI technologies.

“India is going to be a key market, and we are placing bets relevant to the company's future within India,” Vicente said.

The company recently announced a new venture with several global telcos, including Bharti Airtel and Reliance Jio, to combine and sell APIs globally. This will spur innovation in digital services and help in 5G monetisation.

The company has also increased efforts on 6G in India. “We are making recommendations on the right spectrum to use to maximise the efficiency of 6G. The overall progress has been very positive,” he said