Ekholm Concerned about EU Telco Sector

Borje Ekholm, Ericsson CEO, is concerned about the lack of incentive for operators in Europe to build 5G infrastructure. In an interview with Financial Times, Ekholm said it would lead to the continent falling behind the US and China in developing digital industry.

Ericsson chief described Europe’s telecoms industry as non-functioning, stating it was understandable for operators to be reluctant to invest in 5G given the risk of failing to get a return on investment. By falling behind on deploying the next-generation of mobile, Ekholm argued the continent would lag the US and China in the future digitalisation of business.

“Without 5G, general industry will be less efficient and less competitive,“ he said. “Without the infrastructure, it’s hard to develop the digital industry, and that impacts huge value potential and potentially millions of future jobs.“ Ekholm continued to address Ericsson and chief rival Nokia’s role in the wider European ecosystem, noting telecoms was one of the few sectors where the continent had strategic autonomy.

However, with the third major vendor Huawei facing scrutiny and even bans in multiple countries across the region due to security concerns, there has been a push from certain governments to open up networks to new, emerging players. Ekholm described the situation as interesting, while expressing surprise that Europe would undermine Ericsson and Nokia, given there was a discussion about giving EU subsidies to develop competing companies, mostly they are based in the US and Asia.

Ekholm also reiterated criticism of his home country Sweden’s decision to ban Huawei from participating in network builds, a move which he said would hurt its ability to compete on the world stage and restrict free trade. Ericsson has been particularly vocal about the impact Sweden’s decision could have on its own ambitions in China, a country which is seen as vital for the company.