November 14, 2018 / 6:15 PM / 10 months ago

Ericsson doesn't see sales lift after security concerns hit Chinese rivals

Ericsson Chief Executive Officer Borje Ekholm holds a news conference during the Mobile World Congress in Barcelona, Spain February 26, 2018. REUTERS/Yves Herman

BARCELONA (Reuters) - Telecom networks equipment maker Ericsson (ERICb.ST) said on Wednesday security concerns about its Chinese rivals and wider trade tensions had not translated into more orders for the Swedish firm’s products.

Chief Executive Borje Ekholm also said his firm was investing in new technology for 5G networks to help boost its market share, particularly in China.

“There is a lot of speculation going on. There is a lot of discussion about geopolitics,” he said at the Morgan Stanley Technology, Media and Telecom conference in Barcelona. “We let the security agencies and politicians deal with that.”

Asked if there had been any impact on Ericsson sales from worries among operators about Chinese competitors after some governments had intervened citing national security concerns, he said: “We haven’t really seen that to any large extent yet.”

Australia and the United States have decided to ban Chinese suppliers from next generation 5G networks, and German officials are planning a drive to convince the government to consider excluding Chinese firms such as Huawei Technologies Co Ltd [HWT.UL] from building the country’s 5G infrastructure.

Huawei, the world’s largest telecoms equipment maker, has rejected any suggestion it might pose a threat to any country’s national security, saying cyber security has always been its top priority.

Ekholm said telecoms customers had been concerned when the U.S. government temporarily stopped U.S. firms selling to China’s ZTE Corp (000063.SZ) but he said that this had not translated into more orders for Ericsson equipment.

The U.S. denial order was lifted in July. Ekholm said he did not think the trade tensions would make it harder for Ericsson to compete in China, adding that his company had struggled in China in the past because it lacked the product range Chinese customers wanted.

“This time around we are investing to make sure we have the features, we have the functionalities, we are doing well in tests, we are doing well in customer discussions, so I don’t feel that in any way we are put at a disadvantage today,” he said.

Reporting by Paul Sandle; Editing by Edmund Blair

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