Services Briefing 3 November, 2009 London. Copyright Telefon AB LM Ericsson All rights reserved

Transcription

1 Services Briefing 3 November, 2009 London

2 This presentation may contain forward looking statements. Such statements are based on our current expectations and are subject to certain risks and uncertainties that could negatively affect our business. Please read our earnings reports and our most recent annual report for a better understanding of these risks and uncertainties.

3 Services Update Stefan Jelvin Director of Strategic Marketing Business Unit Global Services

4 Global Services in short 2008 services sales SEK 70.5 b. Professional Services SEK 49 b. Network Roll-out SEK 21.5 b. 21% growth in Professional Services 9 months 2009 Stable margins 350 m subscribers in managed network 125 m added last 12 months 37,000 Services professionals (in-house) 175 countries Continued execution on strategy Gaining market share

5 Telecom services market 2008 [USD b] est. Current addressable market Operator internal services spending ~ ~ ~ Managed services Consulting Systems integration Higher growth Education Professional services ~48 ~53-55 ~59-61 Support services Lower growth Network rollout services ~18 ~19 ~20-22 Network rollout This slide contains forward-looking statements. Actual result may be materially different. Source: Ericsson, April 2008 and Ernst & Young Market Study 2007

6 Telecom services market trends Economic downturn bring opportunities Opex/cost reducing measures very valid Improving efficiency also in focus Managed services business opportunity continues to grow Cost and asset optimization - driven in mature markets Growth and competence - driven in high growth markets Network transformation From a business, operational, competence and technology perspective New/more end-user services Operators want more than an equipment vendor They want a business partner

7 Telecom services competitive landscape IS/IT players Products+Services, Only Services, Pure offshore Constellations Independent telecom services providers Telecom equipment vendors Highly fragmented market

8 Successful Services strategy Global Services Networks Expand services business Managed Services Systems Integration Consulting Education Customer Support Network Roll-out Grow services in Ericsson mobile, fixed and multimedia solutions Multimedia Expand our business with operators, providing value through services excellence

9 Number 1 in Telecom Services Ericsson services sales [SEK b] [SEK b] Ericsson sales, CAGR : 12% Services sales, CAGR : 21% Professional Services Rollout services Source: Ericsson reports Also in operator perception

10 Professional Services performance Sales and growth YoY per region months 2009 Western Europe Up 7% Western Europe Up 5% North America Up 15% Latin America Up 16% CEMA Up 18% North America Up 26% Latin America Up 26% CEMA Up 43% Asia Pacific Up 16% Asia Pacific Up 28% 2008: SEK 49 b. 9 months 2009: SEK 39.7 b. A beneficial geographical mix and overall growth

11 Ericsson the trusted business partner Operator Consulting Prime Integrator Managed Services Network rollout Network design Education More than 50,000 strong workforce 175 countries Customer support Managed operation and hosting +28,000 Services Professional close to customers Project +9,000 Management Services Professionals Systems in global integration centers Business +15,000 consulting resources from partners Network and technology consulting Ericsson technology and solutions

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13 Managed Services Valter D Avino Vice President and Head of Managed Services Business Unit Global Services

14 Key managed services trends Ericsson experience Key deals in all regions Managing multi-vendor, multi-technology networks ~50% of equipment non-ericsson 24% year-on-year growth first nine months 2009 Managing networks that together serve >350 million subscribers Experience from >300 managed services contracts

15 Managed Services happens everywhere North America Breakthrough contract with Sprint, US, fixed and wireless CEMA First major managed services contract in Africa with Zain, Nigeria Managed services with with Du, Dubai Western Europe MBNL, Vodafone UK and Telefónica O2 UK TeliaSonera Sweden, fixed

16 Why Managed Services? Technology migration Change agent Financial pressure Competence need Consumer focus Cost Savings Operators reviewing business models and focus

17 Four segments of managed services Operation Field Maintenance Shared Solutions Operational Readiness (Hosting & Managed backhaul)

18 Network sharing scenarios Passive Sharing Network Sharing Active Sharing Savings Site Sharing Consolidate site infrastructure Share new site build Backhaul Sharing Consolidate site and backhaul infrastructure Share new site and backhaul deployment RAN Sharing Consolidate RAN Share new RAN deployment Degree of sharing

19 Network sharing scenarios Consolidate site and backhaul infrastructure Share new deployment Consolidate RAN Share new RAN deployment Savings Consolidate site infrastructure Share new build Site Sharing Backhaul Sharing RAN Sharing Shared operations Shared assets Degree of sharing

20 Conclusion Network sharing a clear trend and a growing market Creates opportunities for services Another reason why managed services market continues to grow

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22 Network Modernization Jan Ögren Vice President Network Roll-Out Business Unit Global Services

23 Ericsson network roll-out Mexico 1897 Peru 2007 Copyright Telefon AB LM Ericsson All rights reserved

24 Ericsson network roll-out Today, so much more... Copyright Telefon AB LM Ericsson All rights reserved

25 Network modernization drivers Increased consumer demand boosting mobile data traffic Drives re-design / upgrades of access networks Requires increased expansion of backhaul capacity Fierce competition among operators Need for cost efficient networks Quality of service and attractive service offering New technologies lowers cost but increases complexity Operators increasingly look for one-stop-shop Time-to-market and handling project risks are crucial Ericsson in prime position to help operators evolve their networks

26 Ericsson network roll-out services The end-to-end approach Project Management Consulting Planning & Build Integration Optimization Operations Design & Support Turnkey Network Rollout Enabling future business success for our customers

27 Ericsson competitive advantage Customer insight and offerings Deep knowledge of customer networks & operations Combination of world class products and services Thought leadership Delivery machine Local & global delivery model Skill & scale Ericsson project methodology Quality assurance Quality systems Training and certification of own, sourced and customer staff Global knowledge sharing & re-use Long term experience to lead in best practices

28 Key business opportunities New network deployment Greenfield deployments Deployments in new regions/areas New fiber networks Network modernization Swap / equipment changeouts Network and site optimization Efficient energy solution Mobile Broadband evolution Technology upgrades (e.g. HSPA / LTE) Capacity expansion in Mobile Backhaul IP-fication of existing RAN

29 References China Unicom 3G Roll-Out 2009 World s largest green-field network deployment AT&T Broadband Access 2009 Full systems solution for fixed broadband access Telstra 3GSM National Network 2007 Largest geographic WCDMA network deployment Metro PCS / USA 2009 Mobile Broadband (LTE) deployment Eco-smart for TIM in Italy 2009 Solar-powered sites generating up to 100% of energy needs Vodafone Essar in India 2009 World record - largest and fastest equipment changeout

30 Network roll-out 2008 and 2009 Highlights Net sales 2008: SEK 21.5 b. (+16%) Net sales YTD 2009: SEK 16.4 b. (+18%) More than 1,200 major projects yearly Network build, expansion and migration Ericsson resources approximately 10,000 Sourced resources more than 15,000 Installation and construction Leadership in network deployment

31 Conclusion Consumer demand force operators to continuously evolve their networks Cost efficiency drives growth in network modernization Capabilities unique to Ericsson puts us in prime position to address this huge market

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