Ericsson counting the cost of customers’ broadband switch

Mobile phone equipment maker Ericsson saw post-tax profits plunge 82 per cent in its fourth quarter.

New chief executive Hans Vestberg said a 13 per cent fall in sales reflected lower spending by mobile networks in several countries but claimed the firm had maintained its market share.

Ericsson has been hit by operators and customers switching more quickly to broadband and data services and so ordering less of the older third generation voice mobile equipment.

Tax profits dropped from 4.1 billion Swedish kronor (£351 million) to 700 million kronor but operating profits of 7.5 billion kronor down from 9.0 billion kronor were in line with analysts' forecasts.

Vestberg said the end of 2009 had seen developing markets such as central Europe, Africa and the Middle East become more cautious on making new investments in mobile infrastucture.