Q&A with Ulf Pehrsson

What is your background?

I’ve been at Ericsson for 15 years but before that I had a long spell at Sweden’s ministry for foreign affairs as a diplomat dealing primarily with trade policy, exports and investment promotion, working in our embassies and so on. At Ericsson I also work mainly in the field of government affairs and trade policy for the company.

Ulf Pehrsson, Head of Government and Industry Relations, Ericsson

You are not a lawyer…
No – in an operator there’s a high chance someone in my position would be a lawyer as those firms are heavily regulated. But Ericsson is a technology company and in fact my group is part of our sales organisation. So my role is much concerned with advocating for the conditions that will grow the market where we see ourselves as market leaders and developers. Regulation and policy are of course crucial in our industry and we are spending even more time on policy, in particular, because ICT is becoming the platform of innovation for all sectors of society and for all economies. Looking back at my time in Ericsson we have focused on traditional supply side issues, making sure conditions for telecoms network investment are there, such as spectrum, as well as general policies for free and open trade. These are no less important today but we now need to broaden more our scope on the demand side.

How do you summarise the most important issues today?

Our starting point is that we are a global company operating in 180 countries. The European Union today is only 20% of our revenues although we continue to base much of our R&D in Europe. In fact we are soon adding 2,000 more engineers based in Poland to our 14,000 strong R&D workforce here. Their focus is on mobile technology. We spend a lot of effort on pushing to free up more frequencies for mobile both in the short and long term, in particular now with 5G, and in promoting the need for harmonised global spectrum and standards on which the mobile industry has been built. We need global scale to achieve interoperability, accessibility and affordability in mobile technologies. We are also now busy in areas such as IP networks, television and the internet of things (IoT). Our new partnerships with Cisco and other firms will be crucial. This

We are already seeing some countries such as the US pushing ahead with bands that are not agreed by the ITU.

highlights how important policies on the demand side are now, and we are actively involved in key issues such as data protection and cross-border data flows. On our traditional area of global trade we have had recent success with the expansion of the Information Technology Agreement (ITA) at the World Trade Organization (WTO) last December, which will lead to the elimination of tariffs for about 200 ICT related products. That has been a top priority for us.

April 2016, Volume 44 Issue 01

How do you see the current state of play in spectrum, following WRC-15?

There is mixed news for us here. WRC-15 [the World Radiocommunication Conference held last November] opened up globally harmonised 4G frequencies, and we have been successful in opening up the 700 MHz band globally, which is extremely important to network rollouts, particularly in rural areas. But although the conference did take more steps in addressing 5G spectrum, there was a lot of caution about even studying new bands for the next generation. We would have liked to see something more ambitious, although overall I feel that so far governments have been relatively successful in freeing up new spectrum resources. It’s just that this is probably one of the fastest moving industries in the world, so the challenge for regulators is to keep up with that speed.

What does this mean for decision-making about 5G spectrum?

We would like to see more rapid agreement on globally harmonised spectrum bands for 5G but the hesitancy by most governments at the ITU level means that we are already seeing some countries such as the US pushing ahead with bands that are not yet agreed by the ITU. The chair of the Federal Communications Commission (FCC), Tom Wheeler, has recently said that the US will lead in 5G and allocate spectrum faster than any nation on the planet, and we think this sets a good example. However, there is still a big void between 6 GHz and 20 GHz, which will be key bands if we are to see an early launch of 5G in the early 2020s. There is also a need for better use for lower bands, such as 600 MHz, which the US is already auctioning now in its incentive auction. I’m happy to see the European Commission focusing too on the 700 MHz band and below. The FCC is also looking at 28 GHz for 5G, a band not yet identified by the ITU. We see that spectrum requirements for 5G are not only about high download speeds by consumers but also a broad range of industrial uses such as in IoT to deliver low latency and also serve many more device types with long battery lives. At present, we see that by 2021, 95% of mobile subscriptions in Europe will be 4G. By then 5G will have launched globally with 150 million or so users primarily in the US and east Asia. Ericsson is already working with some 20 operators on 5G and we expect more countries to follow the lead of the US – we can’t afford to be late and miss the opportunities of 5G. I think what we need to do is a better job of explaining the technology and where the market is going. I am optimistic that we will see better steps towards spectrum harmonisation on the way to the next WRC in 2019, but it is clear we cannot rely entirely on the ITU. We recognise too that there has to be a balance with the interests of satellite operators, broadcasters and others.

What are the demand side policies you are most concerned with at present?

There are a number of interlinked issues such as internet governance, where we very much support the multi-stakeholder governance model, and net neutrality, where in the European negotiations, for example, we have been fairly successful in helping to explain the needs of different industries for so-called specialised services, ensuring the role of operators in running their networks to secure a high quality experience for users. Cybersecurity and privacy are critical too – we feel that the European Commission’s cybersecurity initiative is good and we need to understand that security is a multi-stakeholder issue that has to be integrated into everything we do and must be a continuous process. It’s a question of trust – and inevitably it is becoming more complex. It’s not just about securing voice and data communications but about connectivity in all industries as IoT markets take off around the world. There has also been the collapse of the US-Europe safe harbour agreement, and the negotiation of the new privacy shield, details of which were issued at the end of February, but there are many questions about how this necessary agreement will be implemented. For us, the most challenging policies concern data protection and cross-border data flows as we see data and its handling now becoming the source of innovation in many industries and we do not want to see such ‘data-driven innovation’ held back.

What in particular are you most concerned with on data handling?

We have been leading an industry coalition on putting forward evidence for the European general data protection regulation (GDPR). However, we were not as successful at the final stage as we would have liked. One issue is that in the data handling chain it is very important we are clear about the respective roles of the actors in the chain – one group are the controllers and another the processors of data. The old directive did separate these roles but the GDPR has the notion of joint liability, which we are not in favour of as it creates uncertainty. The other issue is the sanctions, which we feel are excessive, as breaches could cost 4% of global turnover. But we are two years away from implementation so there may still be mitigating efforts.

How do you see the overall climate for policy and regulation in europe and elsewhere?

I see it as about breaking down silos and removing barriers to what we call the network society and the ‘fourth industrial revolution’, as discussed for example at the last World Economic Forum in Davos. We advocate for light touch regulation that should move to ex post, as in other business sectors, not losing sight of the fact that regulation is a means to an end, which should be boosting investment and innovation. In turnregulators need to move from just being a ‘referee’ in a game of players where you say who gets what in terms of benefits and costs to a position where the regulator has a much broader set of tools that play to ICT as 

We need to do a better job of explaining the technology and where the market is going.

a platform for society. It is clear that telecoms investments in Europe have not been on a par with the US and the European digital single market strategy must take this into account. On a global level, we see the message about the underpinning role of ICT being stressed in forums such as the UN Broadband Commission, which my CEO is a member of, and which says national broadband plans need to extend well beyond the ICT ministry to all sectors of government. A new World Bank report, ‘Digital dividends’, also has this theme. Some countries are moving faster than others and some emerging nations are able to leapfrog developed ones in technology and adoption of ICT. But we need to recognise that achieving the overall ICT vision is more easier said than done.