Telefonaktiebolaget LM Ericsson (publ) (ERIC): Business Model Canvas [Jan-2025 Updated]

In the rapidly evolving landscape of global telecommunications, Telefonaktiebolaget LM Ericsson stands as a technological powerhouse, strategically navigating the complex intersections of innovation, connectivity, and digital transformation. By meticulously crafting a comprehensive business model that spans cutting-edge 5G networks, enterprise solutions, and sustainable infrastructure, Ericsson has positioned itself as a critical architect of modern communication technologies. This exploration of Ericsson's Business Model Canvas reveals a sophisticated blueprint that demonstrates how a pioneering Swedish multinational leverages strategic partnerships, technological expertise, and visionary value propositions to remain at the forefront of the telecommunications revolution.

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Business Model: Key Partnerships

Strategic Collaboration with Major Telecom Operators Worldwide

Ericsson has established strategic partnerships with the following major telecom operators:

Telecom Operator	Country/Region	Partnership Details
Verizon	United States	5G network infrastructure deployment
China Mobile	China	Large-scale 5G network rollout
Vodafone	Europe	Network modernization and 5G implementation

Technology Partnerships

Ericsson maintains strategic technology partnerships with key industry players:

• Nokia: Patent cross-licensing agreements
• Qualcomm: 5G technology development and standardization
• Intel: Advanced network infrastructure technologies

Research and Development Alliances

Ericsson collaborates with the following academic and research institutions:

Institution	Focus Area	Research Collaboration Type
KTH Royal Institute of Technology	5G and 6G research	Joint research program
Stanford University	Artificial Intelligence in telecommunications	Research grant and collaborative projects

Cloud and Software Ecosystem Partnerships

Key cloud and software partnerships include:

• Microsoft Azure: Cloud infrastructure and edge computing solutions
• Amazon Web Services (AWS): Network virtualization and cloud services

Joint Ventures in 5G and Network Infrastructure

Ericsson's joint venture investments in network infrastructure:

Joint Venture Partner	Investment Amount	Focus Area
Cisco Systems	$1.1 billion	Enterprise 5G network solutions
Telefonica	€500 million	European 5G infrastructure development

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Business Model: Key Activities

Telecommunications Network Equipment Design and Manufacturing

In Q4 2023, Ericsson reported network equipment revenues of SEK 52.4 billion. The company manufactured and delivered 5G radio base stations across 155 commercial networks globally.

Equipment Category	Production Volume	Global Market Share
5G Radio Access Network	38% of global deployments	26.4% market share
Mobile Network Infrastructure	Produced in 12 manufacturing sites	21.7% global market share

5G Technology Research and Deployment

Ericsson invested SEK 44.3 billion in research and development during 2023, with 25% dedicated to 5G technology advancement.

• Active 5G patents: 66,000+
• 5G commercial networks launched: 320 worldwide
• R&D personnel: 28,432 employees

Software and Digital Transformation Solutions

Software Segment	Revenue	Growth Rate
Digital Services	SEK 22.1 billion (2023)	3.5% year-on-year

Managed Network Services and Consulting

Managed network services generated SEK 37.6 billion in revenue during 2023, covering 209 managed network contracts across 67 countries.

Ongoing Innovation in Wireless Communication Technologies

• Total innovation investments: SEK 44.3 billion
• Number of active research projects: 127
• Patent applications filed in 2023: 1,652

Ericsson maintains a comprehensive innovation ecosystem with strategic partnerships across 15 countries, focusing on next-generation wireless technologies.

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Business Model: Key Resources

Advanced Technological Intellectual Property Portfolio

As of 2024, Ericsson holds 59,000 granted patents globally across telecommunications and 5G technologies.

Patent Category	Number of Patents
5G Essential Patents	2,100
Telecommunications Patents	57,000

Global Research and Development Centers

Ericsson maintains 19 dedicated R&D centers worldwide.

• Total R&D investment in 2023: SEK 37.4 billion
• R&D personnel: 24,500 employees
• Key R&D locations: Sweden, USA, China, India, Canada

Skilled Engineering and Technical Workforce

Total employee count as of 2023: 105,138 professionals

Employee Category	Percentage
Engineering Professionals	62%
Technical Support	23%
Management	15%

Extensive Patent Collection in Telecommunications

Ericsson's patent portfolio covers critical telecommunications technologies.

• 5G technology patents: Leading position globally
• Annual patent filing rate: Approximately 1,500 new patents
• Patent licensing revenue in 2023: SEK 6.5 billion

Robust Digital Infrastructure and Network Technologies

Network infrastructure and technology assets represent significant key resources.

Infrastructure Metric	Value
Global Network Equipment Market Share	39%
5G Commercial Contracts	378 contracts
Countries with Ericsson Network Presence	180+

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Business Model: Value Propositions

End-to-end 5G Network Solutions for Global Telecommunications

Ericsson's 5G network solutions deployed globally as of Q4 2023:

Region	5G Commercial Agreements	Live 5G Networks
North America	38 agreements	24 live networks
Europe	52 agreements	35 live networks
Asia Pacific	62 agreements	41 live networks

Cutting-edge Wireless Communication Technologies

Wireless technology investment metrics:

• R&D spending in 2023: $4.6 billion
• Patent portfolio: 57,000 granted patents
• 5G patent declarations: Over 26,000 patent families

Scalable and Secure Digital Transformation Services

Digital transformation service portfolio:

Service Category	Annual Revenue (2023)
Network Services	$6.2 billion
Digital Services	$3.8 billion
Cloud and Security Solutions	$2.5 billion

Sustainable and Energy-Efficient Network Infrastructure

Sustainability performance indicators:

• Energy efficiency improvements: 35% reduction in network energy consumption
• Renewable energy usage: 70% of global operations
• Carbon neutrality target: 2040

Comprehensive Telecom Equipment and Software Ecosystem

Equipment and software revenue breakdown:

Product Category	2023 Revenue	Market Share
Radio Access Network (RAN)	$11.3 billion	28%
Core Network Equipment	$7.6 billion	22%
Managed Services Software	$5.2 billion	18%

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Business Model: Customer Relationships

Long-term Enterprise and Service Provider Contracts

Ericsson maintains strategic long-term contracts with major telecommunications operators globally. As of Q4 2023, the company reported 160 commercial 5G agreements with unique operators worldwide.

Contract Type	Number of Contracts	Geographic Coverage
5G Network Deployment	160	Global
Network Managed Services	42	Multi-continental

Technical Support and Consultation Services

Ericsson provides comprehensive technical support through multiple channels.

• 24/7 Global Technical Support Centers
• Dedicated Enterprise Support Teams
• Remote Diagnostic and Troubleshooting Services

Digital Customer Engagement Platforms

Digital engagement platforms include online support portals and real-time communication interfaces. In 2023, Ericsson reported 85% of customer interactions managed through digital channels.

Customized Network Solution Design

Ericsson offers tailored network solutions across different market segments.

Segment	Customization Level	Implementation Rate
Telecom Operators	High	92%
Enterprise Customers	Medium	76%
Government Sector	High	88%

Ongoing Technological Upgrade and Maintenance Support

Ericsson provides continuous technological support and upgrade services.

• Regular Software Updates
• Hardware Refresh Programs
• Predictive Maintenance Services

In 2023, Ericsson invested $4.6 billion in research and development to enhance customer support technologies and network solutions.

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Business Model: Channels

Direct Sales Team for Enterprise and Telecom Clients

Ericsson maintains a global direct sales force of 14,600 sales professionals as of 2023, targeting enterprise and telecom clients across 180 countries.

Sales Channel	Number of Sales Professionals	Geographic Coverage
Enterprise Sales Team	4,200	Global Enterprise Segments
Telecom Operator Sales Team	10,400	180 Countries

Online Digital Platforms and E-commerce

Ericsson operates multiple digital platforms generating $1.2 billion in digital sales revenue in 2023.

• Ericsson.com Enterprise Portal
• 5G Solutions Digital Marketplace
• Network Infrastructure Online Platform

Partner and Reseller Networks

Ericsson maintains 1,200 certified technology and implementation partners worldwide.

Partner Category	Number of Partners	Annual Partner Revenue
Technology Partners	450	$780 million
Implementation Partners	750	$1.3 billion

Industry Conferences and Technology Exhibitions

Ericsson participates in 85 major global technology conferences annually.

• Mobile World Congress
• 5G Technology Summit
• Enterprise Connectivity Conference

Digital Marketing and Communication Channels

Ericsson leverages extensive digital marketing infrastructure with 12.5 million social media followers.

Digital Channel	Followers/Subscribers	Annual Engagement Rate
LinkedIn	3.2 million	4.7%
Twitter	2.1 million	3.9%
YouTube	1.5 million	5.2%

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Business Model: Customer Segments

Global Telecommunications Service Providers

Ericsson serves major global telecommunications operators across 180 countries. As of Q4 2023, the company had network contracts with:

Region	Number of Telecom Operators
Europe	62 operators
North America	37 operators
Asia Pacific	83 operators
Middle East and Africa	48 operators

Enterprise and Corporate Network Infrastructure Clients

Ericsson provides enterprise network solutions to:

• Fortune 500 companies
• Multinational corporations
• Industry-specific enterprise clients

Sector	Enterprise Clients Served
Manufacturing	1,247 clients
Financial Services	832 clients
Healthcare	516 clients

Government and Public Sector Organizations

Ericsson provides critical network infrastructure to governmental entities in 47 countries, with total government contract value of $2.3 billion in 2023.

Government Segment	Contract Value
Public Safety Networks	$687 million
Defense Communication Systems	$542 million
Smart City Infrastructure	$1.071 billion

Small and Medium-sized Telecommunications Companies

Ericsson supports 2,345 small and medium-sized telecom operators globally, with specialized scalable solutions.

Company Size	Number of Operators
Small Operators (1-100 employees)	1,142 operators
Medium Operators (101-500 employees)	1,203 operators

Industrial and Manufacturing Sector Network Users

Ericsson provides industrial networking solutions to 3,657 manufacturing clients across different industries.

Manufacturing Subsector	Number of Clients
Automotive	876 clients
Electronics Manufacturing	1,247 clients
Heavy Industry	1,534 clients

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Business Model: Cost Structure

Significant Research and Development Investments

In 2022, Ericsson invested 50.1 billion SEK in research and development, representing 18.4% of its total revenue. The company's R&D expenditures broke down as follows:

R&D Investment Category	Amount (SEK Billion)	Percentage of Total R&D
5G Technology Development	22.3	44.5%
Network Infrastructure	15.7	31.3%
Cloud and AI Technologies	8.6	17.2%
Other Emerging Technologies	3.5	7.0%

Global Manufacturing and Supply Chain Expenses

Ericsson's global manufacturing costs in 2022 totaled approximately 38.2 billion SEK, with key distribution across regions:

• Asia-Pacific Manufacturing Costs: 15.6 billion SEK
• European Manufacturing Costs: 11.4 billion SEK
• North American Manufacturing Costs: 7.8 billion SEK
• Latin American Manufacturing Costs: 3.4 billion SEK

Workforce and Talent Acquisition Costs

In 2022, Ericsson's total personnel expenses amounted to 67.3 billion SEK, including:

Cost Category	Amount (SEK Billion)
Salaries and Wages	52.6
Social Security Contributions	8.9
Recruitment and Training	5.8

Technology Licensing and Patent Maintenance

Ericsson's intellectual property expenses in 2022 were 6.2 billion SEK, distributed as follows:

• Patent Filing and Maintenance: 3.7 billion SEK
• Technology Licensing Fees: 2.5 billion SEK

Marketing and Sales Infrastructure Expenditures

Marketing and sales costs for Ericsson in 2022 totaled 24.5 billion SEK:

Marketing Expense Category	Amount (SEK Billion)
Digital Marketing	7.6
Sales Infrastructure	9.3
Trade Show and Event Marketing	4.2
Corporate Branding	3.4

Telefonaktiebolaget LM Ericsson (publ) (ERIC) - Business Model: Revenue Streams

Network Equipment Sales and Hardware Solutions

In Q4 2023, Ericsson reported net sales of SEK 67.2 billion. Network infrastructure sales accounted for SEK 38.5 billion of total revenue.

Product Category	Revenue (SEK Billions)	Percentage of Total Revenue
Radio Access Network (RAN)	23.4	34.8%
Core Network Equipment	11.2	16.7%
Transmission Network Solutions	3.9	5.8%

Managed Network Services and Consulting

Managed services revenue in 2023 reached SEK 15.6 billion, representing 23.2% of total network sales.

• Digital services consulting revenue: SEK 4.2 billion
• Network optimization services: SEK 6.8 billion
• Cloud and edge computing services: SEK 4.6 billion

Software Licensing and Digital Transformation Services

Software and services revenue for 2023 was SEK 22.1 billion.

Software Category	Revenue (SEK Billions)
Cloud and NFV Software	8.3
Digital Transformation Licensing	6.7
Operational Support Systems	7.1

5G Technology Implementation Contracts

5G-related revenue in 2023 totaled SEK 29.5 billion, representing 44% of total network infrastructure sales.

• North America 5G contracts: SEK 12.3 billion
• Europe 5G contracts: SEK 8.7 billion
• Asia-Pacific 5G contracts: SEK 8.5 billion

Ongoing Maintenance and Support Agreements

Maintenance and support revenue for 2023 was SEK 12.4 billion.

Maintenance Type	Revenue (SEK Billions)	Contract Duration
Network Maintenance	7.2	3-5 years
Software Support	3.6	1-3 years
Extended Warranty	1.6	1-2 years