Invest more in network or lose clients, Ericsson ceo tells mobile operators

Mobile phone operators in Bangladesh should invest more to raise capacity of their network or run the risk of losing unhappy clients to their rivals, Ericsson’s president and chief executive Carl-Henric Svanberg said in an exclusive interview on Friday.   He also urged the government to issue third generation or 3G mobile licences, which he believes will make broadband access to internet far more affordable and widespread.

“Bangladesh may have lesser GDP compared to many countries but its people are willing to spend for communications due to the increasing affordability of mobile phone,” Svanberg said.

He said connectivity increases productivity and the people of Bangladesh believe in it.

“The country has been impressively progressing with an increasingly connected population and the operators should now consistently invest on their networks’ capacity.”

The subscribers’ growth exhausts a mobile network’s capacity, which also impacts the overall quality unless necessary expansion is done at the same time.

“Otherwise, the customers dissatisfied with congestion and dropped calls will switch over to other providers.”

Svanberg’s warning has come ahead of Warid Telecom’s formal launch where Swedish company Ericsson is the dominant equipment supplier and runs the entire network on the sixth mobile operator’s behalf.

The Ericsson chief oversees Ericsson’s worldwide businesses in more than 140 countries from his headquarters on the outskirts of Stockholm.

He came to Dhaka on Friday morning and left in the evening in a private jet. This is the first time the supreme of a telecoms multinational has visited Bangladesh.

Asked why Bangladesh has come into his radar screen, he said: ‘Watching the good results are more exciting than knowing about them through internal memos,’ Ericsson’s ceo briefly laughed.

But he soon became serious.

“Everything is moving at the right direction in Bangladesh and this market is also growing steadily with a great deal of potential.”

But can Ericsson survive in this fiercely competitive and highly cost-sensitive market?

Svanberg said the equipment price constitute 15 to 20 per cent of the cost of a mobile phone project.

Building the base station sites and providing seamless power with other supports consume the remaining 80 to 85 per cent cost.

“We know very well how to reduce both the costs.”

The world’s biggest mobile network maker’s chief said his company offers complete solution — from consulting and planning to implementation and total operation of a mobile phone network.

“If you consider these components, we are highly competitive and that is our biggest strength.”

Svanberg also referred to Ericsson’s commitment in building local human capital. Now more than 500 Bangladeshis are working in Ericsson Bangladesh operations and their standard is no less than the company’s workforce in other countries.

But why Ericsson is investing so much in Bangladesh? Is the not country overcrowded with six mobile operators including Warid?

Svanberg doesn’t think so.

There are only two GSM mobile operators in China, which is the world’s single largest market. A bit smaller, USA has four operators but far smaller Vietnam has six operators.

All of them are great examples of impressive progress due to their economic scale. ‘Therefore, there is nothing wrong with the six operators in Bangladesh,’ he argued.

Svanberg said there is no reason to underestimate the mobile phone market of Bangladesh and the 3G mobile is very much viable here. He said the 3G requires less investment than the GSM network.

“Right now the 3G handsets are a bit expensive but their price will come down at today’s low-end GSM mobile handset’s level in two to three years,” the Ericsson ceo predicted.

Svanberg said the HSPA or high speed packet access mobile broadband solution of 3G “is the perfect solution to provide high-speed wireless internet access anywhere anytime in Bangladesh.”

--Bdnews24.com