Here, there and everywhere In wireless, Ericsson thinks globally but acts locally >BY JASON MEYERS, Wireless Networks Editor

For everything network equipment vendors stand to gain from the explosion of the U.S. wireless market, they also face what might be their biggest challenge: to supply network operators with customized wireless systems that can help them penetrate untapped customer segments.

For a vendor overseeing a wireless division burgeoning faster than any other business area, the further challenge is to convince carriers-particularly entrepreneurial startups driving the growth of the U.S. market-that it can remain focused on its customers' individual needs despite the expansion.

Such is the case for Ericsson, which has experienced heavy growth over the last five years and is now represented in 120 countries. As of June, the Swedish company's Radio Systems business showed the largest increase in net sales worldwide, up 35% compared with its sales in the first half of 1995. Ericsson now has $1 billion worth of wireless systems installed or on order in North America, according to its latest interim financial report.

"Ericsson is a marketing machine that is not easy to copy," says Lars Ramqvist, president and chief executive officer of Ericsson.

The company attributes its global success in wireless to many factors: First, it has only a 3% share of the highly competitive home market in Sweden-a reality that helped teach the company to set its sights elsewhere for gain.

"We were forced out into the wilderness from the very beginning, and that has kept us slim and trim," Ramqvist says.

The company also looks on its investment in technological development as a key business driver: Ericsson upped research and development by 50% over the past year and now has 18,000 engineers around the world working in its development group.

"I see us as the biggest spender in the industry," Ramqvist says.

But the vendor is wary of banking on growth alone, recognizing carriers' customization requirements and honing its business approach toward that end.

"Size is not the number one objective," says Ramqvist. "We have to be very precise in our strategies."

Maintaining that precision can be difficult, however, particularly in the U.S. wireless market where many of the incoming network operators expect-and in some cases require-equipment suppliers to bankroll portions of their network builds.

Having weighed the various options, though, Ericsson has decided against any kind of financing strategy. "We have to say 'no thank you' to businesses because the demands on funds are too high," Ramqvist says.

Instead, the company relies on the international performance record of its wireless systems and its commitment to develop equipment based on wireless standards that can help carriers get to market quickly. A proven worldwide presence, coupled with localized individual approaches, is where Ericsson sees its edge-even with smaller carriers that may be intimidated by Ericsson's size.

"They are looking at making money as soon as possible, and we represent security," says Kurt Hellström, executive vice president of Ericsson and president of Ericsson Radio Systems. "We show that we can deliver what we promise."

The wireless equipment that the company delivers-and how and where-is based on the same global vision/local action philosophy that permeates all of Ericsson's operations. Everything wireless, from terminals to base stations to antennas, is manufactured in 17 plants worldwide by more than 10,000 employees (see map). But here again, the company concentrates on core products and technologies, outsourcing non-core components and products to partners.

Ericsson also designs the physical processes and human resources of its manufacturing plants around what it calls the "model factory" concept. The model is based on competency groups, each with a specific function, and production systems and methods-in engineering, administration and new production-that the company finds most effective.

"Having standard work methods, IT systems and technology gives us flexibility, cost-effectiveness and ease of training," says Björn Boström, vice president of manufacturing for Ericsson Radio Systems.

The goal of establishing competency group and production models is to be able to "clone" production facilities anywhere without redeveloping processes, Boström says.

The wireless network gear produced in those sites is based on several wireless technologies. GSM network equipment has been a virtual flagship for Ericsson's wireless efforts internationally, and with more and more PCS operators deploying GSM's PCS 1900 cousin, its popularity-and Ericsson's market share-is gaining in the U.S. as well.

Ericsson also develops analog AMPS gear and has expanded on that with its digital AMPS and time division multiple access equipment lines.

Ericsson has steered clear of developing equipment based on the IS-95 code division multiple access (CDMA) standard but insists that it has never stopped researching other CDMA turns. The vendor is experimenting with wideband versions of several technologies it believes will eventually carry a range of services beyond voice-including wideband CDMA.

"When we started with CDMA, we talked about it more as a technology being developed for new services," says Jan Uddenfeldt, vice president of research and development for Ericsson Radio Systems. The company is currently operating a wideband CDMA testbed in its facilities in Kista, Sweden.

The availability of a range of technology solutions is another indication of Ericsson's broad yet focused strategy: By diversifying its offerings, the company meets the needs of carriers of various forms and sizes, all of which have somewhat different requirements. That contributes to a controlled growth spurt where the ultimate goal is customer satisfaction, says …ke Persson, vice president of marketing and sales for Ericsson Radio Systems.

"The main challenge for us is to manage the growth and still maintain quality," he says.

LUCENT, MOTOROLA GROW IN ASIA Shensegi Telecomm of Korea has awarded a $71 million contract to Lucent Technologies to supply code division multiple access network equipment, including 5ESS-200 switches and base transceiver systems, for the carrier's networks in the Pusan and Kyungnam regions. In Hong Kong, Hutchison Telecom has awarded Motorola's Asia Pacific Cellular Infrastructure Group a $58 million contract for DCS 1800 base stations, including InCell 6, M-Cell 2 and M-Cell micro equipment.

NEXTEL CONTINUES SPRAWL Nextel launched its combination wireless voice/paging/conferencing service in Denver last week, upping its market total to three. The service is based on Motorola's iDEN technology and operates at 800 MHz. The service is also available in Chicago and Boston and is being tested in Atlanta and Detroit.