BARCELONA, SPAIN: Wireless telecoms equipment makers are expected to see growth this year after two years when network operators cut back on spending to cope with the economic downturn. But competition for deals is set to remain intense.
Much of investment by the operators will be in mobile network gear to keep pace with data-hungry consumers who increasingly surf the web on the go from their smartphones and tablet computers.Also Read: Ericsson demos 168Mbps over HSPA network
Analysts expect growth in the United States to remain strong for the second year in a row, while major rollouts will boost sales in India. Capital spending in Europe is expected to grow only slightly.
Here are the top players in the industry:
ERICSSON
The Swedish company is market leader for wireless networks with a 36 percent share, according to Bernstein Research. It has the fattest margins in the industry due to greater economies of scale.
During the downturn it suffered along with its rivals as operators cut back on spending, but saw a return to growth in the second half of 2010 and sees a strong 2011.
Ericsson bought Nortel's wireless unit in July 2009 for $1.13 billion after the Canadian group filed for bankruptcy, in an effort to expand in the United States.
It also is taking on its rivals in fixed networks through the 2005 acquisition of UK-based fixed-line communications maker Marconi. Telecom operators are increasingly offering bundled services of broadband, fixed-line and mobile services to users, so Ericsson felt it had to broaden its reach.
Ericsson had sales of $31.4 billion last year.
NOKIA SIEMENS NETWORKS (NSN)
The 50-50 joint venture of Nokia and Siemens has 22 percent of the mobile market.
It has struggled to make money since it was formed in a merger in April 2007 and announced a turnaround plan last year to cut thousands of jobs and reduce costs.
Nokia Siemens Networks (NSN) sees an underlying EBIT margin above break-even for this year, and says its sales will grow faster than the slight growth predicted for the overall telecom gear market.
Its parent companies, which are joined in a shareholder pact through 2013, have been considering how they might exit once the turnaround is complete. There have been talks with private equity players and an initial public offering is also seen as possible.
NSN is soon to close a deal to buy Motorola's wireless network business for $1.2 billion in a bid to bolster its position in the United States and Japan.
NSN had sales of 12.7 billion euros ($17.21 billion) last year.
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