Ericsson gets into bed with Datang

Nicole McCormick & Robert Clark | April 21, 2010

telecomseurope.net

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Ericsson is aiming to boost its China 3G offerings by hooking up with state-backed vendor Datang Telecom.

Ericsson announced Tuesday it will integrate Datang's TD-SCDMA radio access network equipment into its 3G portfolio

Under an MoU, it will also jointly develop TDD-LTE network solutions with Datang, which holds virtually all of the Chinese government’s TD-SCDMA patents.

The cooperation aims to promote a “common platform for FDD and TDD” in order to “increase the industrialization capabilities of TDD solutions by achieving economies of scale,” Ericsson said.

The Swedish vendor set up a TDD joint research center with Datang in Beijing in January 2008, but the latest strategic cooperation takes the relationship between the pair “to a substantially new level.”

The announcement follows analysts’ warnings that earnings at Ericsson – the world’s biggest wireless vendor – will be under pressure as Chinese operators trim their 3G rollouts.

Ericsson has won only a small fraction of China Mobile’s TD-SCDMA rollout, which peaked last year. The bulk of the contracts have been won by ZTE, Huawei and Datang Mobile, Datang Telecom’s infrastructure subsidiary.

Ericsson signed a TD-SCDMA product alliance with ZTE five years ago, but the two companies have been marketing their solutions separately.

Datang, a small loss-making vendor spun off out of a government research institute, is at the center of China’s decade-long effort to commercialize TD-SCDMA.

Chen Shanzhi, Datang Telecom vice president and CTO, said the pact with Ericsson will help “drive the globalization of TD-SCDMA and play an important role in the industrialization of TD-LTE in the long run."

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telecomseurope.net

Nicole McCormick & Robert Clark

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