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Ericsson increases lead on telco gear market

(Agencies)
Updated: 2009-02-27 20:20

Sweden's Ericsson expanded its lead in the ailing mobile network gear market in October-December as its closest rivals lost share to fast growing Chinese firms, researcher dell'Oro said on Friday.

Related readings:  Ericsson wins China deals worth $1.4 billion  Nokia considering entering laptop industry: CEO  Huawei estimates sales to climb 35% despite crisis

The telecom equipment market has seen cut-throat competition for new business during the past few years, driven by the Asian vendors, and the outlook remains tough.

Last month, Nortel Networks, the world's fifth largest telecom gear maker, filed for bankruptcy protection in Canada and the United States, blaming the economic crisis for derailing a turnaround effort that began in 2005.

The world's top mobile network equipment maker, Ericsson kept its 32 percent share of the market in October-December, while the share of its closest rival Nokia Siemens Networks fell to 23 percent from 27 percent a year ago, dell'Oro said.

The world's fourth largest vendor Huawei Technologies more than doubled its market share from a year ago to 12 percent, and is approaching No 3, Alcatel-Lucent, which saw its market share sliding to 14 percent from 16.

"For all of 2008, Huawei's revenue for mobile infrastructure nearly tripled," said analyst Scott Siegler.

Dell'Oro forecast for the market for key network technologies - GSM, CDMA, WCDMA and WiMax - to fall around 5 percent in 2009.

"Due to the uncertainty of the economy and the impacts of it on consumer spending, I suspect we will see the majority of operators significantly reduce their capex plans early in the year," Siegler said.

"As the year unfolds, and these operators get a better sense of the actual impact the economic downturn ... we will see capex spending begin to ramp," he said.

Alcatel-Lucent has forecast the market to shrink 8-12 percent in 2009, while Nokia Siemens has said the market would fall more than 5 percent.

The North American vendors Nortel and Motorola, whose stronghold is declining CDMA technology, lost further ground in the last quarter of 2008, and had, respectively 6 percent and 4 percent of the global market, the research firm said.

China's ZTE almost doubled its market share from a year ago to 5 percent, dell'Oro said.