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Technology Stocks : Ericsson overlook? -- Ignore unavailable to you. Want to Upgrade?

To: Jim Oravetz who wrote (4519)	2/13/2001 12:31:47 PM
From: Jim Oravetz	Respond to of 5390

Ericsson Presses Vision Of Nomadic Workers By Ken Schachter, TechWeb Finance Feb 12, 2001 (6:52 PM) URL: techweb.com NEW YORK—Ericsson AB's enterprise unit, coming off a year of flat growth and fending off rumors that its corporate parent plans to put it on the block, launched an offensive on Monday designed to make it a player in the U.S. corporate market. Until now, Ericsson Enterprise AB—with an 11 percent market share worldwide in building corporate communications infrastructure—has had a negligible presence in the United States. But the company is banking on the migration to next-generation communication services—in which workers will be able to tap into corporate information wirelessly at home, in a taxi, at an airport, or on a plane—to give it entrée to the promising market. But first, executives at a briefing at the Scandanavia House in New York sought to quash a few rumors. Goran Rassmuson, director, corporate marketing and business development, said that the parent company, Sweden's LM Ericsson Telephone Co. (stock: ERICY), had no intention of abandoning the production of Ericsson-brand handsets. That's despite a recent deal to outsource production to Flextronics International Ltd. (stock: FLEX) as Ericsson acknowledged the need for economies of scale in manufacturing. The second rumor, that Ericsson is primping the enterprise unit in preparation for a sale, also was denied. Lars Svensson, president of Ericsson Enterprise AB, said the unit has the full backing of its corporate parent, and suggestions that it will be sold are groundless. Still, he noted that the company lacks a strong presence in the United States, and "that's why we're here." Ericsson's mobile vision would let workers with Internet-enabled handsets and handheld computers roam nearly anywhere while transferring seamlessly among the LAN at the office and the PAN, and WAN. The new product line uses Bluetooth and next-generation 3G mobile Internet technologies. The backbone of Ericsson's plan is built on several products, including its Internet-protocol-enabled PBX systems like the MD 110 and Web Switch phone gateway. Market researcher IDC reported that by 2004, revenues for LAN-based PBX systems will exceed $1 billion. Scott Searle, an analyst at SG Cowen Securities, said that the technologies like wireless PBX and data wireless LAN are minor contributors to Ericsson's revenue picture now. But, he added, "these will be significant in the future. You're talking billions of dollars." Ericsson, Stockholm, Sweden, intends to deliver corporations the tools for their "nomadic" workers within a couple of years, Svensson said. Helping to fuel Ericsson's push into the corporate market, executives hope, is its leadership in wireless infrastructure. The company holds a 30 percent market share in mobile systems. The company will be far from alone in competing to create a wireless infrastructure for corporations. IBM Corp. (stock: IBM), with deep roots in corporate computing and a powerful service organization, is expected to offer stiff competition, as is Cisco Systems Inc. (stock: CSCO) and a host of systems integrators. Current GSM and TDMA wireless systems lack the bandwidth needed to empower the data-hungry worker. But, Svensson said, that will all change with advent of 3G wireless services. "The power of 3G, or wideband CDMA, is what's going to hit the office," he said.