Ericsson signs $1.8bn frame agreements with Chinese mobile operators

China Mobile and China Unicom spend big to upgrade mobile networks

Under the agreement with China Mobile, Ericsson will provide a radio access network including a multi-standard radio base station and mobile soft-switching technology, which will boost its capacity  and set it on the path to becoming an  IP network. The new equipment should also help the operator save energy. The deal is worth $1bn and will be implemented during 2010.

Under the agreement with China Unicom, Ericsson will provide a faster 3G network with HSPA Evolution technology. Ericsson will also expand it cooperation with China Unicom in IP and broadband, supplying IP routers, fibre access technologies including GPON and 40Gbit/s WDM links, as well as IP multimedia subsystem (IMS). The deal is worth $800 million and will also be implemented during 2010.

Mats H Olsson, Head of Ericsson Greater China, says: “The signing of the significant frame agreements is a manifestation of our continued strong cooperation with our Chinese customers.”

China's mobile market is growing rapidly, adding 106 million subscriptions in 2009, bringing the total to 747 million. Mobile market penetration is 56.3 per cent. China's fixed broadband market grew about 20% last year, bringing it to a total of 103 million subscriptions.

Ericsson says that 99 per cent of China' population has mobile coverage, thanks to operators' recent expansion into rural areas. However, increased usage, especially with non-voice services, has put pressure on the networks and operators, who are investing in maintaining quality and performance levels, particularly in larger cities.

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