BARCELONA, Spain — Ericsson CEO Borje Ekholm admitted that the much-touted Cisco Ericsson partnership “hasn’t reached the level” that the two companies expected when they joined forces back in 2015. However, he said that they are still working together and are looking for new areas where they can cooperate. Ekholm’s comments were part of the company’s media event held here at the opening of the Mobile World Congress 2018 conference.
Ekholm didn’t provide specifics on what areas the two companies were considering for possible collaboration. When asked if it included Cisco’s newly announced open virtualized RAN (vRAN) initiative, Ekholm only would say that the vRAN was something Ericsson would have to take a look at.
Yesterday, Cisco announced the Open vRAN project along with partners Altiostar, Aricent, Intel, Mavenir, Phazr, Red Hat, and Tech Mahindra. Open vRAN’s goal is to assemble an open and modular RAN architecture that will support different use cases. So far, the group has said it is working with Indian operator Reliance Jio, but it hopes to attract more operator members.
Not Meeting Expectations
In November Ericsson told investors during the company’s Capital Market Days that the Cisco Ericsson partnership wouldn’t reach its target to generate $1 billion in revenue for each company by this year. The partnership was initially formed to combine some of Cisco’s network capabilities and its virtualized services with the network management and OSS/BSS capabilities of Ericsson to help operator customers transform their networks.
Ready for 5G
But Ericsson’s partnership with Cisco isn’t top of mind for the firm. In a media briefing, Ekholm said the company is working closely with its partners on 5G and touted the fact that it’s working with about 30 service providers on the technology. Ekholm noted that many of Ericsson’s 4G service provider customers saw their cost per gigabyte of data decline dramatically when they upgraded from 3G to 4G, and he expects the same advantage when they move from 4G to 5G.
When it comes to 5G, Ekholm said that “customers say they need to succeed with efficiency, virtualization, and lastly identify new revenue sources.”
Ekholm also touted the advantage of network slicing as a way for operators to reduce their network costs. He said that Ericsson believes network slicing is critical for the 5G world; one study commissioned by BT found that network slicing reduced costs in the core of the network by 40 percent and increased revenue by 35 percent as compared to a network that doesn’t incorporate slicing.