Ericsson recently announced the setting up of two new business units in a move to accelerate transformation and support growth. The company has split Networks business unit into two new units, business unit Radio and business unit Cloud & IP. The restructuring has been done to ensure a strong focus on the needs of each business while maintaining an end-to-end view on the full networks operations. Radio is the foundation of Ericsson’s technology leadership, says Christian Hedelin, the head of strategy for business unit Radio within Ericsson. “We are aiming to drive good internet coverage in India and across the globe, and make internet accessible for all. We are focused on building a good internet coverage through mobile networks, cost efficiently. That is our most important mission, we are getting there but we are not there yet,” he tells Sudhir Chowdhary in a recent interaction. Excerpts:
You have recently restructured your Networks business unit. What was the rationale behind it?
Our Networks business unit was very diverse; we had the cloud and IP part and the Radio business. We wanted to focus better on our business unit Radio, which is Ericsson’s core business. The split has been in order to get more attention from everywhere—from the Board of Directors to the C level executives in the organisation—for change decisions and roadmaps for these two identities. Instead of taking decisions or creating roadmaps for one business unit, we can now focus in detail on both business units. We believe this will also help us in becoming more action oriented.
How important is India market for you and how is it different from other emerging markets?
India is, after China, the most populated country on the planet. We have seen great momentum and uptake of smartphones in China and we anticipate similar development here as well. India and China are both important markets for us. We see positive opportunities in India with LTE coming in and penetration taking up. I see that the forecast of analysts is conservative.
What is your India strategy and roadmap for Radio business unit?
As a business unit, our mission is to help our customers leverage their spectrum assets to the fullest —both licensed and unlicensed spectrum. Our attention is completely put into how do we provide the best performance networks, both from the user experience perspective, which is downlink, uplink latency, application user experience and how do we ensure that we get the best total cost of ownership to provide those services. These are the two things that we are investing in. We are investing a lot of time and money into it. Going forward, you will hear more about application coverage form us. We would like to see 10 megabits of downlink and 1 megabits of uplink coverage across the globe for us, because with those speeds you will get very good high definition video.
Our overarching strategy is to bring down the cost and energy consumed. The way we implement that is very simple. It is about multi-standard, multi-band and multi-layer. From the portfolio point of view and from the management point of view, what we are paying attention to is to allow the operators to run multi-standard networks; we are allowing them to reuse same infrastructure regardless of the spectrum that they have.
Multi-band is about allowing flexibility to combine spectrum wherever they have it into one entity. We have also invested a lot of time, energy and money in multilayer, in developing small cell in-built solution, to cater for the capacity demand, that you see coming up, for in-building and also mobile enterprises.
What kind of traction do you see for your new solutions such as Radio Dot system and Picocell in India?
The potential is huge. After operators have built in a robust macro network, they need to have dedicated investments for hotspots, in-building, in subway systems and sports arena, because there are massive amounts of people there. And sometimes in areas which are hard to penetrate from radio waves coming from outside. Our small cell strategy is based on the fact that devices should be able to work on multi-standards and in coordination with macro network. This is different from the niche players that have small cell solutions that cannot work in coordination with macro-networks.
Our Radio Dot solution, is small in size and have no separate power plugs. They basically run power over an Ethernet cable, which costs less than a light bulb. Thus our small strategy is also power efficient.
Do you think it will play a significant role in achieving Digital India vision?
GSM has been the most efficient voice machine and it will continue to cater for the majority of voice communication because of the coverage aspect. When it comes to data, we are aiming to drive good internet coverage across the globe, and make internet accessible for all. We need to concentrate on how can we build a ubiquitous internet, good internet coverage through mobile networks, cost efficiently. That is our most important mission, we are getting there but we are not there yet. Thus our focus is in line with India’s digital vision.
For broadband everywhere, GSM is not enough. HSPA, LTE technologies will be needed to fulfill that vision. HSPA, 3G LAN and LTE are similar in spectrum efficiency.
The benefit with LTE is that it can adopt different frequencies, bandwidths while HSPA is fixed 5 MHtz carrier. So it allows you a bit more flexibility and it also has a flat architecture. Also if we want large population coverage cost efficiently, it would be great to have more license for low band 3G and 4G.
How does it fit into your Networked Society vision?
In the Networked Society, connectivity is the starting point for new ways of innovating, collaborating and socialising. The DNA of Ericsson strategy now is to help and develop products and services that help anything that benefits from a connection. So Networked Society is about internet coverage to all the people on the planet, it is about allowing cost of connection to go down to zero, so that we can connect machines, consumer electronics around us; it is about M2M. It is about connecting everything but it is also about allowing productivity gains in different industries that can benefit from mobile broadband and cloud services. We need to work not only with our customers but across the ecosystem to see how we can cooperate with the education providers. We are working with all the major ecosystem players, with regulators, to consult on spectrum allocation and enabling broadband everywhere.