Yahoo Finance Ericsson (ERIC) to Build Ameren's Private Communication Network
Ericsson ERIC recently inked a contract with Ameren Corporation AEE for an undisclosed amount to develop a private communications network for the utility firm. The deal is the culmination of a 10-year infrastructure and service partnership agreement between Ericsson and Ameren to deploy private communications infrastructure across the latter’s operating markets.
Ameren engages in rate-regulated electric generation, transmission and distribution activities, and rate-regulated natural gas distribution and transmission businesses. This premier utility services provider currently aims to leverage Ericsson Radio Access Network (RAN) solutions to modernize its grid. In particular, ERIC will offer its carrier-grade cloud-native dual-mode core solution with relevant support for future upgrades.
Ericsson radio solutions will enable Ameren to consolidate disparate network solutions into a highly-efficient communications network using the 900 MHz spectrum band. This will improve the grid security and reliability for faster response time at lower costs with the formation of a single standard solution.
Ericsson Radio System comprises hardware, software and services for radio, RAN Compute, antenna system, transport, power and site solutions. It enables smooth and cost-effective migration from 4G to 5G, aiding communication service providers to launch the avant-garde technology and grow 5G coverage fast. The company’s 5G radio access technologies provide the infrastructure required to meet the growing demand for high-bandwidth connections and support real-time, high-reliability communication requirements of mission-critical applications.
The company is focusing on 5G system development and has undertaken many notable endeavors to position itself for market leadership. It believes that the standardization of 5G is the cornerstone for digitizing industries and broadband. Ericsson expects mainstream 4G offerings to give way to 5G technology in the future.
The deployment of 5G networks is expected to boost the adoption of IoT devices, with technologies like network slicing gaining more prominence. Ericsson currently has 174 commercial 5G agreements with communications service providers (of which 91 are publicly announced) and includes 125 live 5G networks across the globe.
The stock has lost 38.7% over the past year compared with the industry’s decline of 14.1%. Nevertheless, we remain impressed with the inherent growth potential of this Zacks Rank #3 (Hold) stock.
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