ZTE said that it ‘seriously looking’ at starting local manufacturing for set-top-box (STBs) and customer premises equipment (CPE) devices, along with its radio products in India for domestic as well as export purposes.
“We are seriously looking at it…we would be a real localized player in this country. We will also consider not only making for India but also for potential customers in foreign countries,” Xiao Ming, President, ZTE Global Sales, told ET. “
“We are not talking about just radio, but also the local manufacturing of products like set-top boxes and CPEs…these will have volumes,” he said.
The Chinese gear maker is looking beyond radio products for network infrastructure because the demand coming from the Indian telcos’ isn’t going to be significant, and it will only pick up once the country finalises 5G deployment plans.
“Everybody is going to finalize their modernization plan, so we will be having a minimum of 4G expansion, hence the requirement will be low. We see if the industry comes to a serious 5G stage, then given the size of the Indian market, the demand will surprise you,” he added.
ZTE’s Chinese rival Huawei already said that it was open to starting 5G radio manufacturing in India along with previous-generation technologies gear like 2G and 4G. “We are currently evaluating the possibility,” Jay Chen, CEO of Huawei India, recently told ET.
Huawei had last year shifted to the Free trade and warehousing (FTW), or trading zone for imports near Mumbai after stopping domestic production due to lukewarm demand.
European vendors have already been making telecom gear in India through their facilities in Pune and Chennai for both domestic and international requirement.
Ericsson is exporting its 4G products and microwave equipment for 2G and 3G from its manufacturing facility in Pune, Maharashtra to markets in Southeast Asia like Indonesia, Singapore, and Thailand. It is now evaluating 5G telecom gear from this facility.
Nokia’s India head Sanjay Malik, head of Nokia India, separately told ET that the company has already shipped 5G new radio (NR) for markets like the US and Europe from its Chennai factory. Last year, Nokia shipped $400 million worth telecom gear from its Chennai factory and half of it was from exports to more than 35 countries.
ZTE’s executive said that 90% of its employee base is from India, and it may further expand its basis its business performance. “In India, more than 10% of overall revenue is being spent on employees. India will always proportionally play a significant role for ZTE,” he added.
The executive said that ZTE has deep know-how in China around 5G use cases, which it can quickly replicate in India. “We look at China and the Indian markets in a similar manner simply because of the scale,” he said.
“Since it is just a starting phase, we are collaborating with customers like Airtel, Vodafone Idea and other partners to develop India-specific use cases. It is still at an early stage,” he added.
ZTE said that it is also open to working with the IT sector players and startup in India to bring local use cases since some global 5G use cases might not be relevant for India.
He said that 5G use cases and feasibility will help telcos monetise their future 5G investments in India.
“It is a common concern for all telcos as they are going to spend money on expansion. We also need to seek how can we get our investments back. We need to help the industry on how to get returns on investment,” he added.―Gadgets Now