) has inked a three-year contract with Poland based T-Mobile for
application development and maintenance of the latter's billing
system. The financial details of the contract were not disclosed.
Following the announcement of the contract with T-Mobile,
Ericsson's share rose 2.2% to close at $11.90 on May 28,
T-Mobile's contract with Ericsson comes at a time when there
is a significant increase in mobile broadband users in Poland.
The steady surge in usage has compelled the network operators to
continuously introduce new offerings and services to meet
subscribers' demands. The operators need to establish more
concrete internal operations that align the business processes
with the technological developments.
The billing solution offered by Ericsson will facilitate
instant changes to the current offerings, rates and billing
procedures. In addition, it will also enable comprehensive
customer care capabilities and will serve 16 million T-Mobile
Ericsson and T-Mobile have been working together for
approximately two decades. T-Mobile had earlier opted for
Ericsson's billing system BSCS iX.
Ericsson has been receiving a number of contracts from major
mobile operators globally. Bharti Airtel had selected Ericsson's
Intelligent Modernization Network Solution for its prepaid
subscribers, banking on which the global telecommunication
operator could offer flexible data plans to prepaid customers and
thereby enhancing customer experience by flexible bundling and
real-time control of chargeable services. Ericsson had received
another contract from India's Reliance Communications worth $1
billion for managed services to operate and manage the wireline
and wireless networks in the Northern and Western States of
India. Apart from these
Ericsson received a contract from Entel, a Chile-based telecom
company, to provide 4G/LTE network to its operators.
Thus, with these contracts on board, Ericsson is fully aligned
to achieve its long-term objective of expanding its base and
operations in the emerging markets. Given the favorable scenario,
we expect Ericsson stock to experience a revision and show a
rising trend in the coming quarters.
Ericsson currently has a Zacks Rank #3 (Hold). Other players
operating in the same industry such as
Ubiquiti Networks Inc
) carry a Zacks Rank #1 (Strong Buy) and
) having a Zacks Rank # 2 (Buy) are worth considering.
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