Ericsson overlook? Message Board

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Technology Stocks : Ericsson overlook?

ERIC 9.720

-1.4%

3:59 PM EST

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To: Mika Kukkanen who wrote (2595)	1/23/1999 9:56:00 AM
From: Raymond	Read Replies (2) of 5390

The BT order is a huge boost for Ericsson.BT is one of the most competent operators in the world and they wouldn't have bought from Ericsson if they didn't have top of the line products in the IP and ATM area.The few big contracts that have been awarded for this next generation telephony networks has gone to Cisco and Lucent.When all the other operators will decide Ericcson will probably have a good chance to get a lot of new orders in this area.Ericsson has also done it without buying a lot of other companies to get the competence like LU and CSCO has done. Something else that will decide where the Ericsson stock will go this year is GPRS. GPRS is the packetdata standard for GSM.I would think that before this year has ended the first operator will be up and running with this new standard.If I recollect correct the speed will be up to 115 kbit/s and the operator can charge per packet sent and received.This will be a big boast for datacom in GSM.Now when you use dataservices in GSM you are sending and receiving on the radiopath during the whole time you are connected.With GPRS you only transmitts when you have data to send which will save battery and radioresources. To be able to have any networks up and running before 2000 the first contracts have to be signed soon.It will be really interesting to see who will get the first contracts.Will it be MOT,NOKA ERICY,LU or CSCO maybe.The first contracts is important because then you will get a head start and in the end it will probably be like with the GSM infrastructure to day that 2 -3 suppliers will dominate totally.My guess is that Ericsson will be one of this 2-3 suppliers GPRS is also important for the 3G networks that will be built.They will probably use a standard very similar to GPRS for the packetdata.So in that context it's also very interesting to see who gets the GPRS contracts. Another thing that will affect the Ericsson's stock is of course if Ericsson will be first with a GPRS mobile.The company that have mobiles will get a monopoly if they are alone.The technology is complicated and that is positive for Ericsson.Ericsson has been the leader in the standardsettingprocess for GPRS.For companies that don't have the same competence it will take longer time to get a mobile to market. 3G contracts will probably be signed this year also. If Ericsson can get both one of the first GPRS and WCDMA contracts the stock will fly.There has been all types of negatives now so if the earningreport is not a catastropy the downside of the stock should be limited. /R

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