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Equipment vendors continuing to struggle with component shortages

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The major western vendors in TBR's 2Q10 Network Business Quarterly (NBQ) Benchmark report found themselves limited by component shortages, most notably in the cases of Ericsson and Nokia Siemens. The good news for these vendors is that as this shortage gradually abates in 2H10, a backlog of deferred activity should result in improving revenue growth.

Equipment vendors were also impacted by regulatory hurdles in India, which translated into delays in the awarding of infrastructure contracts; however, this situation is improving, with Vodafone Essar having selected Nokia Siemens to supply and manage its 3G network in six of the nine Indian provinces where it secured 3G spectrum.

Commenting on the Indian market, John Byrne, Director of TBR's Telecom/Networks Practice, said "Clearly India will be a source of significant revenue growth for all the major infrastructure vendors exiting 2010 and especially in 2011."

TBR estimates Huawei is now in a virtual dead heat with Ericsson in terms of total revenue generation, benefiting from continued penetration into mature markets with infrastructure and particularly strong growth in its handset unit. Excluding handset revenue, Ericsson continued to be the largest vendor in revenue, at $6.4 billion in 2Q10.

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Tags: ericsson  nokia siemens networks  huawei  3g network