Ericsson Is Surprisingly Cheapest Vendor in China
In China, home to Huawei and ZTE, it’s cheaper to buy network equipment from Sweden’s Ericsson, according to Bloomberg.
According to a tender by China Unicom Hong Kong’s parent to purchase some 4G base stations, Ericsson offered to sell its products for 21 billion yuan ($3.1 billion), or 25 percent below Huawei and 22 percent lower than ZTE’s offer. Nokia asked for the highest price at 34.7 billion yuan.
It’s rare for prices of telecommunications equipment to be disclosed publicly, so it’s unclear whether these prices reflect what these companies charge worldwide, but the figures stood out to Edison Lee, an analyst at Jefferies Hong Kong. In particular, the prices indicate ZTE no longer competes on price alone because the quality of its products have improved, Lee said in a note to clients.
Huawei, which has been under fire from the U.S. and its allies over concerns its products may carry security risks, doesn’t face that worry at home. The company emerged as the winner of the Unicom auction. Ericsson reported rising sales in the fourth quarter in China, boosted in part by a telecom contract that had been delayed from previous quarters.