Ericsson Turnaround Could Limit Growth Potential, Says TBR

Ericsson’s turnaround plans may be working, but analysts fear the vendor’s aggressive push to cut costs and focus on the 5G RAN space could limit its future.“Though Ericsson’s focused strategy has proved to be a viable approach to stabilize the company, return it to profitability, and provide incremental organic growth, the key concern will be how sustainable that stability and growth will be over the long term,” wrote Chris Antlitz, a senior telecom analyst at Technology Business Research (TBR), in a new report.Antlitz cited Ericsson’s focus on the wireless access domain that he noted was undergoing significant competitive disruption due to the launch of 5G networks and increased use of virtualization technologies. He explained that Ericsson’s focus could allow it to take market share from rivals, particularly Nokia, Huawei, and ZTE, but that business trends like virtualization, cloud, and white box could impact those efforts down the road.