Ericsson fights for Huawei – face risk of losing China

Ericsson has always been vocal against the Swedish government’s bias against Huawei. According to the Swedish company, it faces a high risk of losing its market share in China if this continues. The company reiterates its concerns about its home market decision to exclude Huawei and ZTE from 5G deployment. Once again, Ericsson mentions the Sino-Swiss issue in its latest prospectus for investors. The prospectus is related to the issuance of 500 million euros of 8-year unsecured bonds by Ericsson.

In a statement, the company reiterated the concerns raised in the financial report for the fourth quarter of 2020. The financial report stated that the decision of the Swedish regulatory agency, the Postal and Telecommunications Administration (PTS) to exclude Chinese suppliers’ products from the country’s network, may affect the economic interests of the country and its industries, including Ericsson. It also pointed out that being headquartered in Sweden means that PTS’s decision is of special significance, and there is a risk of retaliation by China.

“Although Ericsson was invited to participate in various bidding procedures underway in China, the final result is still uncertain. The company’s current assessment is that its hopes of success is quite low”. According to Ericsson, this situation may have an impact on the entire industry.

Ericsson threatens to leave Sweden

In terms of 5G equipment, there are three major manufacturers – Huawei, Ericsson, and Nokia. Since the ban on Huawei by multiple countries, the playing field has not been level. Nokia and Ericsson obviously have an edge over Huawei not because they are better but because of Huawei’s ban.

Ericsson’s CEO is not happy with this situation. Earlier this year, the CEO of Ericsson announced that “If the ban on Huawei still exists, Ericsson will leave Sweden”. The “Daily News” revealed that Ericsson’s CEO, Börje Ekholm, said in a text message to the Swedish Minister of Commerce, Anna Hallberg, that the company would leave Sweden unless the (Swedish government) lifted its complaint against Huawei and ZTE.

Holberg’s response reads “The government cannot lift the ban on Huawei, because the Swedish Post and Telecommunications Administration’s interim secretariat made the decision based on the recommendations of the security department and the National Defense Forces”.

Börje Ekholm also said, “Although we have talked with several Swedish law firms, no one is willing to help Huawei. There are many cowards here”. He also supports that Huawei and other major players should file a lawsuit against the ban.