Ericsson Plans Chinese CDMA Departure

Mats H Olsson, Ericsson's head of China and Northeast Asia, said during the Ericsson Business Innovation Forum held in Shanghai from May 17 to May 18, 2010, that Ericsson has decided not to enter the Chinese CDMA equipment market again.

Early in 2005, Ericsson announced that in would gradually withdraw from the CDMA market. However, in July 2009, the company decided to invest USD1.13 billion to acquire the North American CDMA business of Nortel, who previously announced its bankruptcy. With the acquisition, Ericsson will continue to provide network and technology services to CDMA operators in North American.

About a month ago, Zhang Ken, chief technology officer for Ericsson China, hinted at an industry gathering held by the CDMA Development Group that the company may return to the CDMA market.

Commenting on Ericsson decision, Olsson said that the company has indeed re-evaluated the costs and risks for returning to the Chinese CDMA equipment market, but still chose to give up. He said China only has one CDMA operator, China Telecom, and the company will reduce its capital expenditure in the CDMA equipment market year by year. Although Ericsson will not return to the Chinese CDMA market, it is currently communicating with China Telecom and the two parties have reached an agreement to start tests for LTE trial networks as soon as possible.

Olsson said Ericsson has built TD-SCDMA and WCDMA networks for China Mobile and China Unicom, respectively, in China. He emphasized that the company will continue to support the development of China's TD-SCDMA and TD-LTE technologies. Ericsson has already set up a strategic partnership with China's Datang Telecom and the two parties will jointly develop TD-SCDMA and TD-LTE network and technology solutions to provide more mobile communication services to consumers in China and in the world.

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