Ericsson signs €1.3b China frame agreements

Ericsson has signed frame agreements with China Mobile and China Unicom worth $1.8 billion (€1.33 billion) covering multiple contracts the vendor will sign with Chinese provincial operators during 2010.
Announcement of the frame deals follows analysts’ comments last week that Ericsson’s earnings would be hit by cuts in network spending by Chinese telcos this year.
Ericsson provided few details about the contents of the contracts. It said the agreement with China Mobile was worth $1 billion and included its RBS 6000 multi-standard base station and mobile soft-switching technology.
Its $800 million contract with China Unicom covers HSPA Evolution equipment for the mobile group and IP routers and GPON gear to the fixed-line division.
China’s big three carriers last year accelerated spending as part of the government’s stimulus program. China Telecom has said it expects to slash capex by nearly 50% in 2010, while China Unicom and China Mobile have forecast cuts of 35% and 5% respectively.
Ericsson’s stock on Nasdaq closed at $10.35, up 1.77%.