5G and Beyond

Ericsson: COVID-19 isn't affecting equipment production, but 'a few' employees have virus

The CEO of networking giant Ericsson said that "the short-term impact of the coronavirus on our supply chain has been limited to none."

However, in a post on the company's website, Ericsson's Börje Ekholm confirmed that "a few" employees have contracted COVID-19. Ericsson joins Verizon in confirming that some of its employees have been infected by the virus.

"As of today, all Ericsson's production sites are up and running," Ekholm wrote. "This means that the short-term impact of the coronavirus on our supply chain has been limited to none. Looking ahead to the future, we believe we have a resilient supply chain, with production capabilities in multiple regions. We also have access to components and other materials to keep production up and running. But naturally the shutdown of countries runs the risk of impacting our logistics chains."

Ericsson noted specifically that, for the second quarter of 2020, "we can cover currently forecasted demands, taking into account known implications and expected outcome from mitigations made following the outbreak." The company added that its main production facilities are in the US, Brazil, Mexico, India, China, Poland and Estonia.

The company acknowledged that its site in China was closed temporarily to prevent the spread of the virus, but is now open again.

As for company employees with the virus, Ekholm wrote that "we hope for their quick and safe recovery. We are urging all our employees who can work from home to do so, in order to keep their colleagues as safe as possible. And if employees have to be in the office, we require proper social distancing."

Why this matters
The announcement from Ericsson essentially quells worries among operators that the supply of their 5G equipment could be affected due to the spread of the new coronavirus. Ericsson is the leading supplier of wireless networking equipment in the US, alongside Nokia and Samsung, and has announced 5G equipment agreements with virtually every major US wireless network operator.

However, that doesn't mean COVID-19 won't have a serious impact on wireless network operators in the US and globally. For example, the Wall Street analysts at research firm LightShed Partners predicted a 45% decline in the gross additions of postpaid phone customers in the second quarter in the US compared with the same quarter last year, largely due to the thousands of wireless retail outlets that have been shuttered across the country.

Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading | @mikeddano

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