After beating Q3 earnings expectations, boosting the current year’s market forecast, and rising the next year’s sales target; the globally popular telecommunications equipment manufacturer, Ericsson, stated last week that demand for ultra-speed 5G networks wasrisingat the rate faster than expected.
5G networking technology is the recent cause igniting the ongoing US-China trade war, as the new technology would not onlyhost the upcoming autonomous fleet of vehicles but also manage military communications and smart electric grids.Such a significant point emphasizes a potential risk to national security.
The US has blacklisted Chinese tech giant and 5G network supplier Huawei owing to some concerns that the firm could be as an approach by the Chinese government for surveillance purposes. However, Huawei has constantly denied the US raised allegations.
Sweden-based Ericsson, along with Finland-based Nokia and Chinese Huawei,has been supplying the radio access equipment to the majority of 5G telecom services providers across the globe.After attaining a dominant position in the 5G market, Ericsson stated it was now expecting sales of $23.5-24.5 Billion in the next year, up from the earlier expectations of $21.46-22.48Billion.
After Ericsson revealed the new projected sales target, its shares spiked by 7.4%, lifting the value to a 3-month high.
On a related note, from the last two months, Huawei has been seeking for the US-based companies to license its entire 5G platform. The Chinese company expects a bulky amount, time, and resources from the US firm for setting up the 5G infrastructure across the region.After a month, Vincent Pang—Huawei executive—confirmed that a few US companies expressed some interest in Huawei’s offer, reported by Reuters. However, the tech giant has to go through a much longer way to finalize the deal.
On the contrary, Washington isn’t bothering about Huawei’s deal for the US companies. According to a State Department official, “It is most probably an unrealistic approach that the US carriers would embrace this equipment and even regulate all of the hardware and software by themselves.”