Ericsson to set up R&D unit, hike headcount

Ericsson, the Swedish telecom equipment giant, today announced its intention to set up a research and development (R&D) centre in Chennai, a global services delivery centre (GSDC) in New Delhi and upgrade its GSM radio base station manufacturing facility in Rajasthan. The company is also looking at increasing headcount in the country.

The company, however, did not disclose financial details of the investments, but said it will be investing "hundreds of millions of dollars" every year in the country. At present, Ericsson is investing over $1 million a year for developing the market, R&D and its operations in the country.

"India is one of the most exciting markets in the world. We see immense potential in this region, including an acceleration in demand for services, and are committed to partner with India in its growth," Carl-Henric Svanberg, chief executive officer, told reporters here today.

The company's new R&D centre in Chennai will conduct research in cutting edge technologies such as service layer and value-added services (VAS) among others, while the GSDC in Gurgaon will strengthen its managed services offering in India.

The GSDC includes a systems integration competence centre, a product customisation centre, a regional network operating centre and a mobility world centre. This will also help in furthering an existing contract with telecom service provider Bharti Tele-Ventures, signed in managed services space in 2004.

Ericsson will also upgrade its RBS manufacturing facility at Kukas, Rajasthan, and commence manufacturing of mobile switching centres (MSC) and base station controllers (BSC). The company will also transfer technology from the parent in Sweden to help Indian operators get "good quality and cost-efficient solutions".

India is the second largest mobile market in the world, second only to China, with about 2.5 million new users being added every month. The industry expects that there would be around 200 million mobile subscribers and 10 million broadband users in the country by 2007, and these initiatives bank on growth prospects of the country.

The company is also looking at increasing its headcount. At present, Ericsson has around 1,000 employees on its rolls and over 3,000 people through partners and channel firms.

The expected ramp-up figures were, however, not divulged.

Svanberg, who was in India on his fourth visit, had met bureaucrats and ministers including IT and Communications Minister Dayanidhi Maran. He will flying back to Stockholm on Tuesday.

Meanwhile, Ericsson Marker Unit India and Sri Lanka President Mats Granryd said the company would look at participating in the $4 billion tender by BSNL for adding 70 million GSM lines in the country. The company will also look at similar network upgradation and modernisation projects by other telecom players in the country.