Ericsson's Advance LTE for Batelco - Analyst Blog

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Ericsson ( ERIC ) was recently selected by Bahrain's Batelco to expand the latter's LTE and WCDMA technologies. The financial details were not disclosed. With the help of this contract, Batelco intends to expand its coverage to the new areas of the country along with providing faster mobile broadband connections to its existing subscribers.  

Bahrain Telecommunications Company (Batelco) is one of  the leading telecommunications companies providing its services across the MENA (Middle East and North Africa regions-covering from Morocco to Iran and also includes majority of Middle Eastern and Maghreb countries) region and also internationally. Its primary markets include Jordan, Kuwait, Saudi Arabia, Yemen, Egypt, Guernsey, Jersey, Isle of Man, Maldives, Diego Garcia, St. Helena, Ascension Islands, Falklands, Monaco and Afghanistan. The company has a subscriber base of 7.8 million across the MENA region and generated revenues of BD (Bahraini Dinar) 304.7 million ($81.2 million). The company also has strong international operations, which accounted for about 41% of its total revenue in fiscal 2012.

This contract with Ericsson to upgrade its existing technology is primarily to increase its coverage and its mobile broadband experience for its subscribers. With the deployment of Ericsson's advanced LTE technology, Batelco customers will benefit from the upgraded mobile network and will be able to access the Internet at a speed of up to 150 MB (megabits) per second. Through the contract, Batelco also plans to offer superior cloud and multimedia services to its customers.  

For the effective deployment of the services, Ericsson will establish LTE base stations in the new areas and upgrade the Evolved Packet Core network. In addition, Ericsson will support the LTE roaming facility by means of the new Ericsson Diameter Signaling Controller, which helps operators manage roaming relations while improving service reliability and network security.

This contract with Batelco highlights the importance of deploying advanced broadband technology to meet up with the increasing demand for superior Internet quality and high speed upload and download capacities driven by the rapid adoption of devices such as smartphones/tablets. Therefore, telecom operators across the globe are deploying advanced technologies to upgrade their existing networks.

According to Ericsson, the number of global mobile subscriptions is estimated to grow from around 6.3 billion at the end of 2012 to approximately 9 billion by the end of 2017. Of these, around 5-6 billion will be mobile broadband subscriptions. Further, around three-quarters of a billion of these mobile broadband subscriptions will use mobile PC/tablets/mobile routers, but the vast majority will still use mobile phones to access the Internet. Therefore, mobile data traffic volume is estimated to increase by about 9 times from 2012-2017. 

Ericsson is the world's largest supplier of LTE technology with approximately 13% market share. To date, Ericsson has established about 150 LTE networks worldwide and has made communication easier and more convenient by providing high-speed data for mobile phones and data terminals. Recently, Ericsson received a number of LTE contracts from leading telecom companies across the globe.

Another leading company in the wireless networks industry, Alcatel Lucent ( ALU ), has been receiving important contracts from leading telecom companies for deploying advanced technologies for LTE and 4G. 

Ericsson currently has a Zacks Rank #3 (Hold). Other companies in the industry worth considering at the moment are Ubiquiti Networks Inc . ( UBNT ) and DragonWave Inc. ( DRWI ).  Ubiquiti Networks has a Zacks Rank #1 (Strong Buy), while DragonWave Inc . carries a Zacks Rank #2 (Buy).



ALCATEL ADS (ALU): Free Stock Analysis Report

DRAGONWAVE INC (DRWI): Free Stock Analysis Report

ERICSSON LM ADR (ERIC): Free Stock Analysis Report

UBIQUITI NETWRK (UBNT): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: ALU , DRWI , ERIC , UBNT

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