August 13, 2009 / 8:54 PM / 10 years ago

Ericsson doubles lead on telco gear market -Dell'Oro

* Ericsson Q2 mkt share 32 pct vs 32 pct yr ago-Dell’Oro

* Nokia Siemens Q2 market share 20 pct vs 26 pct yr ago

* Huawei Q2 market share 17 pct vs 10 pct last year

* Alcatel-Lucent Q2 mkt share 12 pct vs 14 pct

By Tarmo Virki, European technology correspondent

HELSINKI, Aug 13 (Reuters) - Sweden’s Ericsson (ERICb.ST) doubled in the second quarter its lead in the ailing mobile network gear market as its closest rival Nokia Siemens Networks [NSN.UL] sharply lost market share, researcher Dell’Oro said on Thursday.

The telecom equipment market has seen cut-throat competition for new business during the past few years, driven by Asian vendors, and the outlook remains tough. Alcatel-Lucent ALUA.PA has forecast the market to shrink 8-12 percent in 2009, while Nokia Siemens has said the market would fall some 10 percent.

However, Carl-Henric Svanberg, the chief executive of the world’s top mobile network gear maker Ericsson (ERICb.ST), told Reuters earlier this week he does not see wireless operators cutting capital spending any further but added that signs of an economic recovery remain elusive. [ID:nN11359969]

Ericsson, kept its percentage share at 32 share of the market in April-June, but its lead to closest rival Nokia Siemens Networks (NSN) grew to 12 percentage-points as NSN share fell to 20 percent from 26 percent a year ago, Dell’Oro said.

Nokia Siemens has lost market share for several quarters in a row as the venture is trying to improve its profits and shies away from the tightest competition. Huawei increased its market share to 17 percent, while its cross-town rival ZTE Corp (000063.SZ) (0763.HK) doubled its share to 8 percent. Alcatel-Lucent’s share fell to 12 percent from 14 percent, Dell’Oro said.

Huawei and ZTE have gained global market share via aggressive pricing policy and generous financial support from state-run banks.

The tight market has claimed its first major victim this year. Nortel NT.TO, once the largest North American maker of telecommunications gear, filed for Chapter 11 bankruptcy protection in U.S. federal court and for creditor protection in Canada’s Ontario Superior Court of Justice in January.

Last month, Ericsson won an auction for the key CDMA and next-generation LTE wireless technology assets of Nortel, beating out Nokia Siemens Networks and private equity firm MatlinPatterson. [ID:nN25483564]

Editing Bernard Orr

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