Ericsson CTO: Spectrum will be more valuable than oil

BARCELONA, Spain--A top Ericsson (NASDAQ: ERIC) executive believes that in the not-to-distance future, spectrum will become more valuable than oil. He also predicted that the industry will see a lot more investment in technologies that make spectrum use more efficient.

Ulf Ewaldsson, senior vice president and group CTO at Ericsson, said that a large proportion of Ericsson's $5 billion R&D budget is going to technologies that improve spectrum performance and keep data bit per hertz cost to a minimum. He also predicted that we will see a change in how many governments around the world handle spectrum allocation, noting that although the U.S. recently set a record with its $45 billion AWS-3 spectrum auction, other countries are talking about not doing auctions. "We are going to see the landscape change," he said.

In comments here at the Mobile World Congress trade show, Ewaldsson outlined several key areas for the company that he believes have the most opportunity. He noted that heterogeneous radio networks, where Ericsson has traditionally been strong, will continue to be a big focus for the company. He also said that Ericsson is working to expand network coverage and enhance the indoor network where approximately 70 percent of the wireless traffic occurs.

He also said the company is focused on cloud IP and the transformation of the core network. Interestingly, he said that while he believes service provider SDN has been over-hyped in the past year, he does see an escalating convergence of the wired and wireless networks.

But perhaps the most interesting area Ewaldsson touched on is the company's work to drive wireless technologies into other industries, such as the automobile and home areas. He said that this will be particularly challenging because every industry has its own complex ecosystem. But he said that recently car makers, home appliance companies and more have been reaching out to Ericsson because they want mobility solutions and they need help understanding the technology. Ewaldsson said that recently he met with the CTO of a Swedish appliance maker who wanted to add connectivity to appliances in the home because he believes it will dramatically change how they do business and handle upgrades. "Their CTO was very excited and I pretended to be excited," Ewaldsson said with a laugh.

He revealed that studies from car makers show that one in two customers today would switch car brands to get connected car features in their automobiles. And he quoted an IEEE statistic that predicts that 75 percent of vehicles will be autonomous by 2024.

That stat is notable as earlier this week Renault Nissan CEO Carlos Ghosn said that he believes early autonomous cars will hit the road by 2016 but that he doesn't expect to expect to see driverless cars until at least 2025.

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