Business

Ericsson eyes stable growth
in RI business

Hans Vestberg: (Bloomberg)
Hans Vestberg: (Bloomberg)

The Sweden-based communication technology and services provider, Ericsson, is expecting its business in Indonesia to see stable growth this year on the back of the country’s growing demand for high-speed broadband services.

Visiting Ericsson CEO Hans Vestberg said in a limited press briefing on Wednesday that his company constantly innovated to meet growing consumer demand for high-speed broadband to support its telecommunication needs, which had shifted from voice to data transfer.

“We spend roughly US$5 billion a year on research and development to come up with new solutions and innovations for our clients,” he said, adding his company would launch a new device that would be able to boost indoor Internet speed.

The International Data Corporation (IDC) Indonesia previously estimated the country’s total broadband market was expected to grow 55 percent until 2016.

IDC projected the total broadband subscriber base had hit 39.8 million users in 2013, a 28 percent increase from 31 million users a year earlier.

Vestberg said that globally, mobile subscribers would hit 9.2 billion people in 2019, 8 billion of which were broadband subscribers.

Ericsson networks business head Johan Wibergh said in the same event that the indoor Internet speed booster, known as the “radio dot” system, would be launched in the fourth quarter of
this year.

It is able to boost the indoor Internet speed with an area coverage of up to 600 square meters.

He said the product would be one that competitors in the country did not yet possess.

Market players in the country’s telecom vendor business include the Nokia Siemens Networks and Huawei.

“We will offer the device to our operator’s clients. It will be able to help them have greater efficiency in their business,” he said.

Ericsson, through its local unit PT Ericsson Indonesia, has served three major telecommunication operators in the country, namely PT Telekomunikasi Selular, PT Indosat and PT XL Axiata.

Ericsson posed a slight decline in its global revenue to SEK227.4 billion ($35.2 billion) last year from SEK227.8 billion in 2012, particularly due to currency depreciation and the reduction of its clients’ investment activities in India and northeast Asia regions.

The firm’s revenue from India fell by 5 percent to SEK6.1 billion because of poor macroeconomic environment and delays in regulatory legislation in that country.

In Northeast Asia, the company recorded a 24 percent decrease in revenue to SEK27.4 billion because many long-term evolution (LTE) technology projects, which are mostly handled by Ericsson, were just about to commence by the end of the year.

The Southeast Asia region, however, grew by 5 percent to SEK15.8 billion last year from SEK15.01 billion in 2012, with Indonesia becoming one of biggest contributors.

“Indonesia has become one of our top five revenue contributors for several years […]. We enjoyed good growth in this country and we’re looking for good growth this year as we have very strong position in the market,” said PT Ericsson Indonesia president director Sam Saba. (koi)

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