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Swedish telecom giant Ericsson expects to be the top vendor in China's future 3G (third generation) mobile telecom equipment market, an executive said.

"We aim to continuously consolidate and grow our leadership in China by strengthening our local organization and elevating local competence," said Mats H Olsson, president of Ericsson Greater China.

"We will continue to reinforce Ericsson's capacity in local research and development (R&D), manufacturing and services in China over the coming years, which will lay a good foundation for our future growth in the country."

Currently Ericsson is the largest vendor of the 2G (second-generation) mobile telecom gear market in China. The firm is the largest supplier of GSM/GPRS network equipment to China Mobile, with over 35 per cent market share. And it accounts for about 15 per cent of China Unicom's GSM network.

Strengthening local efforts

In the past few years, Ericsson has aggressively revamped its localization efforts. China is now one of the three major global supply hubs and in May the firm established a centre for sourcing, supply and telecom services in Southwest China's Chongqing Municipality as part of its efforts to strengthen its local supply capability.

Its R&D activities have grown at an annual rate of 30 per cent for the past 5 years with 25 per cent of its employees in China engaged in R&D and product development.

Last year, Ericsson announced it would invest an additional US$1 billion in China, which is giving a major boost to expansion of the firm's manufacturing, R&D and service capabilities in the country.

"We are well positioned to support Chinese operators in the 3G era," said Olsson.

So far the Chinese Government has yet to decide when and how to award operators with the licences to build 3G networks. But Olsson believed that the WCDMA standard would dominate the 3G market. WCDMA competes with CDMA 2000 and TD-SCDMA, a Chinese home-grown 3G standard.

As GSM and WCDMA share the core networks, operators running GSM networks usually choose WCDMA standard and upgrade their GSM networks to WCDMA networks.

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