5G R&D China is the focus of Ericsson's return to China's mobile communications market with 5G
5G R&D is already a key strategy in China. In the field of mobile communications, Ericsson is a pivotal “playerâ€. How Ericsson regains the Chinese mobile communications market is not easy. It is reported that Ericsson has been officially deployed among the three major operators in China. The 5G end-to-end equipment has been infiltrated from 4G, and Ericsson can return from the king. In the global mobile communications market, Ericsson is a banner. However, in the Chinese market, Ericsson has encountered no small trouble. From 3G TD-SCDMA to 4G TD-LTE, Chinese companies occupy at least 70% of the market. 5G, TDD and FDD technology are equally important, and 5G will open communication into the door of all things, Ericsson hopes to regain this important game and become a pivotal "player" in China's mobile communication market. On January 17, Ericsson's Northeast Asia region launched the 5G point system to further improve its 5G end-to-end solution on the second day of China's release of the third-phase test specification for 5G technology trials. In China's 5G R&D trials, Ericsson is also an important force and has performed well in the second phase of the 2017 wireless and core network tests. Does this mean that Ericsson will have more opportunities in the Chinese 5G market? Peng Junjiang, general manager of Ericsson's Northeast Asia R&D Center, introduced Ericsson's R&D investment in 5G, R&D status in China, and participation in testing. Ericsson has invested heavily in 5G R&D. Ericsson has the largest investment in R&D in the world's top 500 companies, and China is Ericsson's largest R&D center in addition to Sweden. Ericsson currently has more than 5,000 highly educated R&D engineers in China and thousands of new recruits in 2017. Ericsson has done two reasons for this: First, China has the largest market, and second, China has the best engineers. Ericsson's R&D center in Beijing is responsible for standardization across the Asia Pacific region and participates in all 3GPP standardization efforts. In addition to 3GPP work, it is actively involved in the coordination of open source network management. In 2017 alone, the 5,000-person R&D center produced hundreds of patents that were certified and approved. In the 5G test, since the launch of the 5G technology research and test in the Ministry of Industry and Information Technology in 2016, the first phase test and the second phase test, including the third phase test just started, Ericsson actively participated and performed well. During the first phase of testing, Ericsson focused on 5G high-frequency technology and productization, although it was developed to meet the needs of North American operators, but China's high-frequency industry is relatively weak, Ericsson first introduced it to China for testing, to promote the entire support The industrial chain plays a positive role. In the second phase of testing, Ericsson focused on 3.5GHz testing, and the wireless part achieved good results in terms of downlink throughput, ultra-short delay, and ultra-high reliability in mobile broadband. The core network also does a lot of work. There are two modes for the core network in the 5G standard. One is the non-independent networking of the NSA, and the other is the independent networking of the SA. China is a very important promoter in independent networking. The independent networking brings great changes to the core network, and it also brings business flexibility. The focus of the 5G core network is how to establish a flexible network architecture to meet the needs of communication in various industries in the future. Ericsson first developed 5GC (5G core network), and in the 5G test is the only one that takes all the tests in one and a half days. 100% completed business. The third phase of testing is for commercial system verification, which faces many challenges. Since it is facing commercial use, it means interoperability and end-to-end interoperability between multiple vendors. The biggest end-to-end challenge is the terminal. Commercial terminals must use integrated circuits. The cost of the chip is very high. Therefore, the standard needs to be more mature and stable. From a technical point of view, some of the programs in the third stage of testing are still very divergent, and they must continually converge through testing and technical verification, and finally form a unified standard for commercial use. Ericsson's collaborative testing was not only carried out in the communications industry, but in the second phase, Intel opened the first 5G phone with end-to-end test equipment, when the standard was not frozen. The two sides have done a lot of work to coordinate and have accumulated a lot of experience to prepare for the next step towards real pre-commercialization. Ericsson's R&D center in China not only develops products, but also establishes very extensive cooperation with China. Ericsson participated in China's national special development. Last year, it won the national major special 5G experimental project. The 5G UAV is a new concept verified by Ericsson and China Mobile in the national major project, and solved the 5G ultra-short delay through the new platform. Control problem. Ericsson's point system released on January 17 is not a brand new product, because in the 4G era, its point system has become famous, and it has been officially deployed among the three major operators in China, and many of them have not been able to enter. The place has completed deep coverage. The 5G point system is more like an upgraded version of the 5G indoor coverage problem. Zhang Zhiwei, chief marketing officer of Ericsson's Northeast Asia region, said that the point system is the same size as the palm of the hand. It is a system of small base stations developed by Ericsson Credit for 14 years. It is placed indoors when 3G and 4G are used. The advantage is that it is easy to construct. It only needs an Ethernet cable connection to achieve indoor coverage like WiFi. The whole system is a very small base station. It is connected to the base station through optical fiber. One floor can be filled with a point system. The base station can be pulled to a centralized computer room a few kilometers away. The point system can support subsequent evolution, carrier aggregation, 5G, etc. Low cost, easy deployment and easy maintenance. In the point system, Ericsson has some unique technologies, such as raising the Ethernet 100-meter network cable standard to 200 meters, which is more suitable for the entire building; for example, combining two point systems that are close to each other to be combined into one base station. The solution to solve the interference problem of dense deployment. The 5G point system is characterized by support for the latest 3GPP 5G standard, and will support independent networking in the future. Its frequency range is from 3GHz to 6GHz, which is also the planned frequency band of China's already announced 5G IF. Zhang Zhiwei said that Ericsson's 4G point system has been deployed a lot. These already installed Ethernet and network cables can be reused, installed in a station, and upgraded at existing sites. Make full use of the existing 4G point system distribution system, and then add 5G points. Zhang Zhiwei said that Ericsson's macro station system has already approached the pre-commercial level by participating in global and China's 5G testing, and this year will also promote 5G commercial deployment in North America. In China, it is a 3.5GHz intermediate frequency product, and the point system complements the wireless network products, can support low frequency to high frequency macro stations, plus the 5G point system for indoor coverage, Ericsson 5G product line can be realized Complete coverage of the network. Upgrade and evolution have always been an important feature of the communications market. Ericsson still adopts a smooth evolution strategy in the 5G market, and pre-embeds its 5G solution access network in the 4G network. In its third quarter 2017 financial report, Ericsson stated that its gross profit margin reduction is to expand the 4G penetration rate in markets such as China, which will lay the foundation for the 5G market. Focusing on the connection of 4G, 4.5G and 5G is also a relatively obvious feature of Ericsson 5G research and development. In June 2016, Ericsson launched the world's first 5G NR wireless device AIR 6468. It supports massive MIMO technology with 64 transmit and receive antennas, embedded with Ericsson's 5G plug-in (Plug-Ins) software module, which will be Massive MIMO Plug-In, MulTI-User MIMO Plug-In, RAN VirtualizaTIon Plug-In, Intelligent ConnecTIvity Key 5G technology concepts such as Plug-In and Latency ReducTIon Plug-In are fully introduced into existing cellular networks. This means that the AIR 6468 can not only improve the LTE network performance of the operator, but also can smoothly transition to 5G through software upgrade after the 5G air interface standard is determined. However, this approach will encounter troubles in the core network. The 5G independent networking (SA) network architecture led by China Mobile in 3GPP will be a brand new service architecture, which is also a major change in the mobile core network. Ericsson's ministry on the 5G core network also needs time to check. In recent years, faced with competition from rivals such as Huawei and Nokia, Ericsson’s market share has gone from bad to worse. Ericsson's second quarter 2017 financial report showed that the quarterly profit margin and revenue were less than expected. In the second quarter ended June last year, the company's revenue fell 7.8% year-on-year to 49.9 billion Swedish kronor (about $6.023 billion). Ericsson's operating loss for the quarter was 1.2 billion Swedish kronor (about 145.3 million US dollars), while operating profit for the same period last year was 2.8 billion Swedish kronor. The adjusted operating profit is approximately SEK 300 million. Its third-quarter 2017 financial report showed that its net revenue was 47.8 billion Swedish kronor (about 5.85 billion US dollars), down 6% year-on-year. The net loss was SEK 4.3 billion (US$ 530 million), compared with a net loss of SEK 2 billion (US$ 240 million) in the same period last year. Ericsson's business in North America is relatively stable, while sales in mainland China have declined. In China, Ericsson has been trying to increase its market share in LTE (4G) and hopes to gain an advantage in the 5G competition. During the same period, Nokia's operating capacity was higher than market expectations. In the second quarter of last year, it benefited from a patent transaction with Apple and improved profitability of its online business. The second quarter profit before tax was higher than the same period of the previous year. It grew 73% to 574 million euros ($674 million) and total revenue was 5.63 billion euros, down from 5.67 billion euros in the same period last year. But Nokia also said that the global network market for the whole year will be more challenging than previously estimated. The financial situation has not improved, Ericsson has been facing the urgent pressure to reduce costs, and the R&D investment in the early 5G period is not huge. Once it enters the pre-commercial and commercial period, the product development and solution research and development will start to increase exponentially. In addition, mastering the supply chain and realizing rapid market feedback also requires more investment. Ericsson wants to return to the status of the king in the 5G market, and the challenge is greater than the opportunity.
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