The company has already tied up with Sony and Nepstar to offer value-added services such as downloading of music and ringtones.
TOKYO: Swedish telecom major Ericsson has given its nod for restructuring Indian operations shifting focus on the fastest growing segment multimedia in the telecom
sector and may tie up with local or global companies for providing content to telecom operators and subscribers.
"We have divided our entire business into three sub-areas, namely network, service management and multimedia and IT," Ericsson officials said, adding the new set up would come into force from January next year.
"Our strategy remains organic growth with bolt-on aquisitions," Ericsson President and CEO Carl-Henric Svanberg told media but declined to reveal exact plans on takeovers.
He, however, was upbeat on India's potential for growth in the telecom sector. "India's telecom story is fascinating... It may be a late entrant in mobile telephony
but is catching up rapidly and the potential is enormous.
"Ericsson will continue to play an important and significant role in this part of the world," he said.
Asked whether Ericsson was looking at increasing investments in its Indian operations, Carl-Henric said: "We shall keep investing as we grow."
Mats Granryd, Managing Director, Ericsson India said, "Ericsson is paving the way for telecom growth in India, these changes -- creating three separate business units will allow us to be even more responsive to the needs of millions of telecom subscribers in India."
According to P Balaji, Vice President Marketing and Strategy the Ericsson Board has cleared the proposal to create three different business units -- Business Unit Network,
Business Unit Services and Business Unit Multimedia.
"The new set up will come into effect from January 1, 2007," he said, adding the company may go for alliances with domestic and global companies for content.
Balaji said network business was "steady", services growing faster but multimedia was growing at the fastest pace.
Ericsson is targeting to have 55 per cent revenue share from its networking business, 30 per cent from service management and the remaining 15 per cent of business to come from multimedia services.
The company has already tied up with Sony and Nepstar to offer value-added services such as downloading of music and ringtones and could enter into more such alliances to offer a host of multimedia services to telecom operators and subscribers.
"Even Yahoo and Google can be our customers to offer such multimedia and IT services," Balaji said.
The reason behind Ericsson's strategy to restructure its business into three heads is to take advantage of an early entrant in the emerging segments. As and when multimedia and IT services are adopted by mobile operators, the company should be ready with all solutions, he added.
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