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Ericsson Moves to Win in the All IP-Convergence World

VenkatramanMcGrath

March 27-29, 2009

2009: INTECH Business Case Competition

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Setting:

• Post Mobile World Congress, 2009

• Favorable industry trends– 4 billion subscribers in the

world– Mobile broadband is here– Strong growth in traffic

• Strong performance trend by Ericsson– Great recent wins in the

marketplace– Solid financial performance

SettingPost Mobile World Congress, 2009

Favorable industry trends4 billion subscribers in the world

Mobile broadband is hereStrong growth in traffic

Strong performance trend by EricssonGreat recent wins in the marketplace

Solid financial performance(c) Boston University School of Management and Ericsson, 2009

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But.. How well is Ericsson positioned for the future?

(c) Boston University School of Management and Ericsson, 2009

There is still potential growth

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(c) Boston University School of Management and Ericsson, 2009

Ericsson’s recent performance is encouraging

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(c) Boston University School of Management and Ericsson, 2009

2009: An Inflection Point

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The US Senate Appropriations Committee estimates that for every USD 1 invested in broadband networks, USD 10 are returned to society.

The returns could be even higher with mobile broadband networks as they are cheaper and faster to build than fixed networks.

(c) Boston University School of Management and Ericsson, 2009

Carl-Henric Svanberg is cautiously optimistic

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2008 Annual Report

(c) Boston University School of Management and Ericsson, 2009

Yet.. The marketplace is competitive and

complex

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Profitablegrowth?

New competitors?

Valueproposition?

Margin shifts?

(c) Boston University School of Management and Ericsson, 2009

Competitors.. Familiar and New…

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(c) Boston University School of Management and Ericsson, 2009

Listen to the CEOs of two competitors: (2) Alcatel Lucent

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(c) Boston University School of Management and Ericsson, 2009

Carl-Henric’s request to Hans Vestberg

Take a fresh look at how well Ericsson is positioned for the future

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(c) Boston University School of Management and Ericsson, 2009

Vestberg’s preliminary framing

All Communicating

world

Margin shifts to solutions

Acquisitions and alliances

Global scale& Competence

Open innovation

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Ericsson’sProfitableGrowth

(c) Boston University School of Management and Ericsson, 2009

1. All Communicating World

“A single, common IP infrastructure that can handle all network services, including fixed and mobile communications, for voice and

data services and also video services such as TV.”

What will this world look like in 2015? 2020? Can you provide better clarity of

this space?13

(c) Boston University School of Management and Ericsson, 2009

2. Margin Shifts

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Products Services &Solutions?

Is this assumption generally valid?How should Ericsson capitalize on this trend?

(c) Boston University School of Management and Ericsson, 2009

3. Acquisitions and Alliances

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?What do you see as part of the future portfolio in Ericsson? Why?

(c) Boston University School of Management and Ericsson, 2009

4. Global Scale and Competencies

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How to further leverage

Ericsson’s global scale? What can

Ericsson learn from other companies?

(c) Boston University School of Management and Ericsson, 2009

5. Open Innovation

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Is there a strategicrole for open innovationwithin Ericsson?

(c) Boston University School of Management and Ericsson, 2009

Vestberg’s preliminary framing is your starting point

All Communicating

world

Margin shifts to solutions

Acquisitions and alliances

Global scale& Competence

Open innovation

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Ericsson’sProfitableGrowth

“Issues areinterrelated”

(c) Boston University School of Management and Ericsson, 2009

Your TaskDevelop a presentation to lay out your analysis of how well Ericsson is positioned to

win in the all-IP converged worldIdentify how Ericsson can position to win along the five themes as a starting frame

but feel to free to frame the opportunities and challenges as you see themDelineate risks and vulnerabilities that you see as you analyze the marketplace and

competitive actionsProvide your well reasoned recommendations to guide Ericsson over the next decade.

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(c) Boston University School of Management and Ericsson, 2009

GuidelinesReview the attached background material as a starting point and

then embark on your search—widely and deeply!Please make reasonable assumptions when necessary and be

prepared to justify them when asked by the judgesMake the best use of the 24 hours to craft powerful and

compelling recommendations for Ericsson to win in the all-IP world.

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