Empowered by vision of a connected world

Ericsson to leverage its heritage with growing demand for data services, says official

Ericsson, the Swedish mobile telecoms gear maker, is confident that its strong research and development capabilities will help the company weather the market challenges in China.

Hans Vestberg, its president and chief executive, says that despite challenges, there is enough room for sustained growth in China, which is on the cusp of a data revolution.

Ericsson, which traces its China roots to 1894, will continue to build on that rich legacy, he says.

"We'll continue to support China in its transformation and upgrade process as it strives to be a leader in technology and services," he says. "We're happy to share our world-class technologies and practices."

He says data traffic in China was forecast to grow 65 percent a year from 2014 to 2020. "What this means is strong market demand."

To tap that potential, Ericsson plans to increase its more than 2 billion yuan ($304 million; 280 million euros) annual investment so that it can support its customers in China and stay ahead of the competition.

Vestberg spoke about his company's strategies in China in an interview with China Daily. Here are edited excerpts of that interview.

What are your business strategies as you readjust to new Chinese economic initiatives and realities?

By 2020, we envisage a world with about 26 billion connected devices. Anything that can benefit from a connection will eventually have one, to the advantage of people at work, at home and during their free time. We call it the networked society.

We're delighted to see that the Chinese government has identified infrastructure connectivity as a priority for the Belt and Road Initiative. This is in line with our strategies and vision to be the driving force behind the networked society.

As a world leader in information and communications technology and services, we believe in the power of ICT, which not only serves as the backbone of the all-connecting infrastructure, but also enables people in other industries to innovate, collaborate and communicate.

That's exactly what we're doing in China. We are the strategic partner to all three telecoms operators, vigorously providing industry-leading mobile networks and services to support our customers in improving user experience for individuals and enterprises alike.

And we're also expanding into new areas, innovating technologies and business models for other industries such as transportation, utilities and public safety.

How do you assess the prospects of your business in China in conjunction with the market?

We expect long-term evolution subscribers in China to exceed 1.1 billion by the end of 2020. That will account for about 30 percent of the total global LTE subscriptions. It's a tremendous number.

Chinese consumers are also rapidly changing to 4G technologies, with more than 70 percent of devices sold now being 4G capable.

Ericsson has been in China for more than 120 years. We have confidence in Ericsson's business prospects in this market, as we have the best technologies, best experiences and best talents here.

We've forged excellent partnerships with Chinese telecoms majors. We see a continuous demand for better ICT infrastructure and advanced services and solutions.

What's your biggest achievement in China as CEO?

First of all, we should never rest on achievements made in the past. But we're definitely proud of being part of every important milestone in the history of China's telecoms industry.

In the past three years, we are particularly proud to be supporting all three operators in China to build up the world's largest 4G LTE network at a record speed.

We're proud that since 1892, when Ericsson received its first order from China for 2,000 telephone sets, the cooperation has withstood the test of time. Over the past decades, especially since opening-up and reform, Ericsson has made active contributions to economic development and the rapid growth of the Chinese telecoms industry with our advanced products and solutions.

How do you get along with local partners?

Growth in four key areas - high-tech investment, job creation, exports and human resource development -have helped Ericsson establish a solid network of partners in China.

What is the secret of your business success in China?

Ericsson is the world's leading supplier of ICT solutions and services. Today, more than 40 percent of the world's mobile traffic goes through Ericsson networks, and the networks we support for operators serve more than 2.5 billion subscribers.

The great thing about Ericsson is that we're constantly reviewing our business and trying to find out how to stay relevant. The landscape of the telecoms industry in the world, and also in China, has changed dramatically over the past three decades. Competitors come and go, but Ericsson will always be center stage.

One of the most important factors in our success is that we invest in our future. We have 37,000 patents and spend more than 2 billion yuan a year on R&D in China. That's how we have always been able to support our customers and to stay ahead of competition.

What's effective leadership for a company engaged in China business? How has your style of management changed over time?

Ericsson has customers in 180 countries. For us, it's important to attract local talent and build local competence to support our customers. This is the same in China. Since 1892, we've relied on local talent to keep our customer satisfaction at a high level.

Ericsson believes in diversity and inclusion. No matter the gender, race or age of an employee, they should be empowered to perform their best. This is reflected in the increasing diversity of the management team in China.

How do you motivate your international team?

Ericsson is a true international company. Our 117,000 employees are international, working as a team across the globe to support our customers in 180 countries. Being an international team member is motivation in itself for our employees.

How do you handle hardships and setbacks, if any?

I love what I do. Having an excellent team of professionals working for me has given me the confidence to withstand all challenges.

What do you think about the China Dream? What are your dreams or ambitions in China?

Ericsson shares the so-called China Dream because its vision of a networked society is also about empowering every person and every industry to reach their full potential.

Ericsson considers itself a true partner in the economic and social development of China. We're committed to this market and will spare no efforts in supporting the transformation of not only the telecoms industry, but also other industries.

What are your hobbies? How do you spend your spare time in China?

Unfortunately, while in China on business trips, my schedule is usually full, as I want to spend as much time as possible with my customers and my colleagues.

Gao Shuang contributed to this story.

fujing@chinadaily.com.cn

( China Daily Africa Weekly 01/29/2016 page31)