The CEO of Ericsson says the European telecom industry is probably unsustainable

The CEO of Swedish telecom company Ericsson warned on Monday that the structure of Europe’s industry is likely to be unsustainable, calling for consolidation across the region to boost competitiveness.

The comments come shortly after the company, which is one of the world’s largest providers of 5G mobile networks, announced it plans to cut 8,500 jobs as part of its cost-cutting measures.

“The big problem in Europe really is that our customers simply can’t afford to build out the networks and I think this will hurt European competitiveness in the long run,” Ericsson CEO Börje Ekholm told CNBC’s Karen Tso. at the Mobile World Congress in Barcelona, ​​Spain. .

When asked how the region can tackle this problem, Ekholm replied: “You know my opinion on this, I really believe that Europe needs to consolidate.”

Ekholm said that in countries like the US, China and India, consolidation would have meant there were now only two or three operators nationwide.

In Europe, however, “it’s 200 operators, about four plus in almost every country. It’s an industry structure that is probably unsustainable and needs to be addressed,” Ekholm said.

Ericsson’s CEO said it was still “very, very early” in the 5G journey, but tipped India to build one of the world’s strongest 5G networks in the coming quarters.

Ekholm said India was also “likely to start driving innovation on top of the grid much sooner than many other countries.”