Ericsson splitting media business into broadcast and solutions units

Ericsson HQ (ericsson)

Ericsson unveiled its new business strategy that will include splitting its media business into two separate units: Broadcast and Media Services and Ericsson Media Solutions.

The move is being done to “create a stronger operational focus” while the segment explores strategic opportunities.

“Video traffic today constitutes over 50% of mobile data traffic globally, and is forecast to grow to 75% by 2022. We have built a strong and competitive portfolio and we have become a world leading supplier of TV & Media products and services,” said Ericsson in a news release.

According to The Wall Street Journal, part of Ericsson’s new strategy could entail selling off part of its business helping broadcasters with video transmission.

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As the report points out, Ericsson is exploring “strategic opportunities” for its Media business. That division could be due for some impact as SVOD services eat into demand for Ericsson’s ability to offer VOD and DVR solutions.

The shift, which is impacting other Ericsson business segments including networks and managed services, is coming as the Sweden-based tech giant looks to recover its market position.

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"For some time Ericsson has been challenged on both technology and market leadership and the group strategy has not yielded expected returns. In our strategy review we have listened carefully to customers around the world and made an in-depth analysis of our portfolio and performance. To enable us to immediately take action and move with speed in execution we are today outlining our path to restoring profitability and to lead with innovation and best in class solutions in areas we have decided to focus on," said Börje Ekholm, Ericsson president and CEO in a statement.