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Telecommunication equipment industry has undergone drastic developments and changes since the 1990s. The telecommunication equipment industry has become quite popular due to the tremendous increase in the use of communication services all over the world. This paper provides a deep insight into the major manufacturers involved in the telecommunication equipment industry. It also highlights the core policy transformations and privatization changes occurring in the global telecommunication industry which is affecting the service providers present in the industry.
Telecommunication equipment industry has encountered tremendous development in a consistent way since its very inception. The term "telecommunication equipment" comprises of a variety of telecommunication related devices which are manufactured by several vendors spanning over the entire industry. The demand for new and better services has actually fueled up the purchase of advanced telecommunication equipment all over the world (Brown, 2011). The changing regulatory environment of the telecommunication industry has affected the manufacture of telecommunication equipment to a great extent. This paper firstly explains the devices and equipment which are included within the domain of telecommunication equipment. It then gives a detailed account of the popular manufacturers of these telecommunication equipment. Lastly, the article explains some regulations pertaining to the telecommunication equipment industry and the consequences of such policy regulation on business organizations and strategies of the telecom industry.
Overview of Types of Telecommunication Equipment
Telecommunications is basically a mammoth industry which involves the production of hardware equipment, the development of relevant software products and the formulation of appropriate communication services using both the hardware and software products. Hardware telecommunication equipment involves catering users with communication services spanning worldwide through telephone handsets, fiber-optic transmission cables, and video broadcasting satellites. The services catered through telecommunication equipment include provision of internet access and configuration of private networks for corporate business firms. Software is designed for controlling the telecommunication equipment in an effective way.
Telecommunication equipment can be categorized in to three core units on the basis of the functionalities offered by each equipment. These types comprise of transmission equipment, public switching equipment and customer premises equipment. Transmission equipment basically deals with transmission lines and base stations which serve as a medium of transferring the signals. Transmission equipment usually comprises of transmission lines like optical fibers, base transceiver stations, multiplexers, and local loop and communication satellites. Most telecom service providers are upgrading the wired transmission techniques from copper cables to fiber optic cables. The demand for fiber optic-based transmission equipment has increased drastically over the recent years. Public switching equipment comprises of analogue and digital switches which cater the exchange of information among different users (Kabacinski, 2007). Switching equipment actually complete connections between callers by routing the signals appropriately.Customer premises equipment includes routers, modems, mobile phones, and landline phones etc. which are manufactured for the end users to get themselves connected with the entire telecom transmission system.
Major Industry Players in Telecommunication Equipment
The core telecommunication equipment manufacturers spanning worldwide comprise of Ericsson, Huawei, Alcatel-Lucent, Motorola, Nokia Siemens, Nortel and several other Chinese firms as well. All these companies are operating worldwide and cater end-to-end telecom solutions comprising of hardware and software products along with services to enterprise customers and service providers (Maadivanan et al., 2007). We can further segregate these major players in the domain of telecommunication equipment on the basis of specialized equipment manufactured by each. Ericsson, Huawei, Alcatel-Lucent, ZTE and Nokia Siemens are ranked amongst the top telecommunication equipment vendors present globally. Apart from the Cisco systems and Juniper Networks are also two renowned names in the industry of switch manufacturing. Samsung, Nokia, Motorola, Apple and HTC are also considered as the top mobile handset vendors all over the world. The following section of the paper will now briefly discuss the details of the core telecommunication equipment manufacturers.
Ericsson is ranked as the largest telecommunication equipment maker which captures a significant market share globally. Ericsson is ranked highly for its quality mobile network infrastructure and telecom services as it captures a market share of 38%, according to the statistics of 2011. It caters with end-to-end solutions, systems and services enabling fixed and mobile networks to transmit voice and data effectively. They ensure that all the elements present in the communication chain are integrated well with each other. Ericsson caters mobile operators with base stations, radio network controllers, mobile switching centers and service application nodes. Ericsson is basically a Swedish company which has the privilege of being the inventor of Bluetooth. During the 20th century Ericsson leaded the market of manual telephone exchanges. It encountered heavy losses after the crash of telecommunication industry in 2000.
ZTE and Huawei
Huawei and ZTE are the two core Chinese firms which are ranked as the world's second and fifth largest telecom equipment makers for years. These Chinese enterprises have surpassed their foreign counter parts in the capital intensive and technology intensive industry. According to the statistics of 2012, Huawei is said to have overtaken Ericsson in terms of telecommunication equipment manufacturing (Xinyu, 2012). The core factor leading towards Huawei's success is the investment made by it in the Research and Development sector. The telecommunication equipment made by Huawei is characterized by low cost manufacturing and efficient supply chain management system. Huawei caters three core business segments which comprise of manufacturing equipment for telecom networks, provision of global services and consulting service to enterprise customers. Fixed and mobile soft switches, Internet Protocol Multimedia Services (IMS) and next generation Home Location Register are the significant equipment manufactured by Huawei for telecommunication networks. Global services provided by Huawei comprise of system integration services for enhancing the operational efficiency of telecom networks. USB modems, tablet PCs, smartphones, wireless gateways, fixed wireless terminals and set-top boxes are the important and latest devices made by Huawei for telecom networks.
The telecommunication equipment manufactured by Alcatel Lucent comprises of mobile, fixed and converged network technologies and IP technology software and services. Bell labs were founded by Alcatel Lucent which is regarded as the largest R&D and innovation center present in the communication industry. Its success is actually attributed to the merger of Alcatel and Lucent technologies which were two different telecom solution providers in Europe and U.S. respectively. Alcatel possessed a strong wire line access equipment business while Lucent technologies were a champion in the wireless industry with tremendous in-depth knowledge pertaining to UMTS, 3G and CDMA platform. The merger thus served as a strong asset for both the companies and earned them great synergies due to the combined resources. Alcatel Lucent caters four business divisions namely: Fixed Networks, Core Networks, Platforms and Wireless. The research department of Alcatel Lucent is centered on the domains of radio frequency systems, fixed broadband access, IP, optics and core networks.
Nokia Siemens is a telecommunication equipment manufacturer and a multinational data networking company formed through the merger of mobile network giant Nokia in Finland with the carrier related communication division of Siemens in Germany. This merger company is ranked as the third largest player in the telecommunication equipment manufacturing industry (Maadivaanan et al., 2007). The integration of handset business of Nokia with the home gateway business of Siemens actually opened new prospects of advancements in the domain of next generation networks, home networking and IPTV. Nokia Siemens catered the telecommunication equipment manufacturing industry with business communication services ranging from mobile backhauling to device management, customer care support and WCDMA frequency reframing. The company catered services for both GSM and UMTS RAN networks which further enhanced the company's portfolio.
Motorola Inc. leads the world of wireless telecommunication solutions, with WiMax being its fundamental achievement in the domain of broadband wireless technology. Its global presence made it easier to capture the mobile markets in Africa and Asia. Enterprise mobility solutions and Home & Network mobility solutions tend to be the two core services catered by Motorola in the domain of wireless technology. It presents RFID-based solutions, wireless infrastructure devices and data communication devices to customers worldwide. It also develops digital video systems, interactive set-top devices and voice and data modems for cable networks and digital subscriber lines (Maadivaanan et al., 2007).
Cisco Systems and Juniper Networks
Cisco systems and Juniper networks tend to be the two significant networking equipment manufacturing companies which are based in America. These companies cater a wide variety of switches and routers for forming different sort of network in enterprises and homes. Cisco Systems provide security solutions, VoIP conferencing devices, network storage devices, line of access points and cable modems for forming telecommunication networks at home and enterprises.
Major Policies Regulating Telecommunication Equipment Industry and their Impact
Regulations in telecommunication equipment industry are needed for interconnection, telecom licensing, network connection, and telecom security. Regulations are needed for fostering competitive markets to cater good quality services, efficient prices and efficient supply of telecommunication services to the service providers. It lends a hand in preventing market power abuse which results in excessive pricing and anti-competitive behavior of dominant firms. Regulatory and licensing processes cater transparency which ultimately promotes public…[continue]
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