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Ericsson (ERIC) to Revamp Telenet's Network With 5G Rollout

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Ericsson (ERIC - Free Report) recently announced that it has collaborated with a Belgium-based telephone service company — Telenet — to modernize the latter’s existing network infrastructure consisting of 2G/3G/4G network. This will pave the path for a faster, cost-effective and energy-efficient connectivity on the back of Ericsson’s 5G expertise. Markedly, Telenet is touted as the country’s largest provider of cable broadband services.

Apart from establishing a future-proof network, the Swedish telco equipment vendor will be responsible for the nationwide deployment of 5G technology. Consequently, the rollout of an optimized 5G network will help Telenet to not only bolster innovation with several technological advancements but also tap lucrative opportunities.

As a 5G RAN (Radio Access Network) vendor, the latest move will enable Ericsson to boost Telenet’s digital transformation while strengthening its footprint across the Western European country. Amid rapid technology shifts, the alliance comes as a boon, especially at a time when majority of the service providers are shifting toward automated operations for addressing business critical needs.

Markedly, Ericsson is considered as an ideal partner as it will help Telenet to primarily focus on exploring the full potential of next-gen technologies such as IoT (Internet of Things) and Augmented Reality while driving the overall 5G development.

Per the alliance, Telenet will capitalize on Ericsson Radio System products and solutions to streamline its existing connectivity framework. The high-performance network, which will form the crux for analysis and automation purposes, is expected to enhance both capacity and coverage, and reinforce Belgium’s economic recovery with utmost agility.

It is worth mentioning that Ericsson Radio System comprises hardware, software and services for radio, RAN Compute, antenna system, transport, power and site solutions. It enables smooth and cost-effective migration from 4G to 5G, enabling communication service providers to launch the innovative technology in an effective manner.

Ericsson’s 5G RAN technologies provide the ultimate infrastructure required to meet the growing demand for high-bandwidth connections and support real-time communication requirements of mission-critical applications. Apart from the Radio System portfolio, the deal includes Massive MIMO (multiple-input, multiple-output) portfolio, which will introduce seamless connectivity in both rural and urban areas.

Interestingly, Ericsson has been supporting Belgium’s networking landscape for more than 50 years, sharing a long-standing relationship with Telenet. This extended partnership is likely to not only realize the wide benefits of 5G but also develop the operational and technological facets of Telenet for consistent connectivity.

To date, Ericsson has secured 132 commercial 5G agreements with unique communication service providers, of which 76 are publicly announced. Notably, the company is witnessing a healthy momentum in its business, based on the strategy to increase investments in 5G, while enabling new use cases in IoT and Big Data.

Moreover, investments in research and development have established it as a leader in 5G. The company’s patent licensing business continues to perform well, backed by a strong intellectual property rights portfolio. Such optimistic industry trends are expected to bode well for Ericsson in the long run.

Ericsson currently has a Zacks Rank #3 (Hold). It has a long-term earnings growth expectation of 28.9%. The stock has rallied 99.4% compared with industry’s growth of 78.3% in the past year.

Some better-ranked stocks in the industry are Aviat Networks, Inc. (AVNW - Free Report) , Ubiquiti Inc. (UI - Free Report) and Clearfield, Inc. (CLFD - Free Report) . While Aviat Networks and Ubiquiti sport a Zacks Rank #1 (Strong Buy), Clearfield carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Aviat Networks delivered a trailing four-quarter positive earnings surprise of 61.7%, on average.

Ubiquiti has a long-term earnings growth expectation of 32.9%.

Clearfield delivered a trailing four-quarter positive earnings surprise of 62.6%, on average.

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