I think we are very confident about the leadership in the technology space, and that is reflected in the fact that we are providing 20 5G commercial networks in all geographies around the world. If you take the example of the most competitive and advanced 5G market, which is South Korea, there are independent benchmarks, which show that Ericsson
is providing higher performance by up to 20 per cent than the second best. All four major vendors are present in that market.
But one of your customers in India, Bharti Airtel, has said Huawei has superior 5G technology compared to others…
Our customers are our esteemed partners and they (Bharti) continue to be very strong partners. I cannot say anything about their view of course. We have had discussions with out our customers on many aspects such as how we can serve them better, how we can show there is an upgrade path, etc. But, I can’t really comment on what perceptions they may have, especially related to our competition.
The other bone of contention is that Europeans sell gear which is more expensive than the Chinese, and they also offer cheap credit lines.
We have had large increases in our R&D (research and development) budget. That means that we can lower the cost of the platform and we have a more efficient way of building our 5G system, which again brings the cost down. And, that makes me also very comfortable that we have a cost position that is very competitive. So, again, I think this is a perception issue. I think there may be differences that come from history. And, I think it’s very difficult to comment on those as well.
Indian telcos also point out that if the government does not allow the Chinese to sell 5G telecom gear, the Europeans don’t have enough capacity to meet the demand. Is there any basis of this fear?
We have enough exactly for India and the global market. On the question of how many vendors will be allowed, it is for the governments to decide as it is a national issue. We don’t have a view. But we have a very significant capacity and we have ramped it up so that there are no delays. As soon as our customers are ready, we are ready.
The recent SC order on the AGR (adjusted gross revenue) has put added pressure on the financial health of telcos. Over and above that, 5G spectrum prices are very high and many of the telcos say that won’t participate in the auction? What is your view on these challenges?
I think there is a great opportunity in India. But all of this comes on the back of realising that the mobile infrastructure is the core infrastructure for the country.
Our message is the same around the world — investments are needed to bring coverage of the technology and bring capacity, needed for traffic growth. And then, it’s important that there are no excessive burdens on the industry when it comes to spectrum costs because that would prevent building the national infrastructure.
I think there has to be a trade off that every government needs to do to get investments in an infrastructure that will serve the country in terms of innovation for many, many years to come. It cannot be and should not be taxed up front with heavy burdens.
India also seems to be planning to offer very limited spectrum. For instance, in 3,300-3,300 band 300 Mhz was available earlier. Now it seems there is only 175 Mhz available for three players. The global standard is that you need 100 MHz to power 5G. So can technology help in rolling out 5G with less spectrum?
Well, first of all, I think this is up to each and every one of our customers to decide on their road map for introduction of 5G. I think the beauty with the Ericsson
solution is that we are already preparing for 5G with 4G equipment that is being rolled out today. In fact, most of the 4G equipment we’re building in India are ready for 5G.
We have technologies such as dynamic spectrum sharing which allows 5G and 4G share spectrum seamlessly. You can actually use your existing spectrum and combine that with new spectrum in 3.5 Ghz and get a better user experience and actually use the spectrum more efficiently. But governments should allocate as much as possible of the 5G spectrum, as this will help in costs coming down.