Ericsson Returns to the Mobile Industry with M7450
Swedish telecom equipment maker Ericsson, which two decades ago was one of the popular brands of phones on the market, again try to gain a foothold in the mobile industry. At this time it is not about the issue itself gadgets and electronic components for them.
Currently Ericsson, supplies its partners test samples so-called LTE-thin modems by which devices are connected to networks of the fourth generation. In May chip Ericsson M7450 certified the world’s largest operator China Mobile. This product is tested and other cellular companies in the world, spoken in Ericsson.
Strategy Analytics experts estimate the global market for thin modems at $4.1 billion, where 92 percent stake controls Qualcomm. In this market, according to Björn Eklund (Bjoern Ekelund), head of strategy and ecosystem modem unit Ericsson, there is still room for new players, and mobile ecosystem itself requires the presence of several manufacturers in each of its segment.
Ericsson does not make a profit from the business for the production of modems. In his company intends to invest about $390 million this year to attract the cooperation of phone manufacturers. Persuade them to use the products instead of Qualcomm Ericsson Swedish company will not be easy, said Strategy Analytics analyst Sravan Kundodzhala (Sravan Kundojjala).
According to experts, the average cost of the chip in $17 M7450 company needs to sell about 45 million of these chips this year to get at least a zero growth, not to mention profits. Analysts doubt this success.