Ericsson ERIC recently won a contract from India's leading direct-to-home (“DTH”) operator – Tata Sky – to improve the experience of Indian TV viewers. Per the deal, Tata Sky has upgraded its entire DTH platform to Ericsson's industry leading video compression platform, AVP 4000 System Encoder. With this, Tata Sky will be able to increase the number of channels while enhancing the video quality.
The deal underscores Ericsson’s leadership position as a video compression solutions provider in the satellite broadcast and DTH space in India. Encouragingly, four out of the seven Indian DTH operators have collaborated with Ericsson to enhance their base in the country.
We believe that this strategic deal will strengthen Ericsson’s relationship with Tata Sky. Notably, in March this year, Ericsson aided Tata Sky for the debut of its first commercial 4K video service, which enhances the resolution of high definition videos in India. Amid rising contents and video-enabled devices in this hyper-connected era, Ericsson projects the total mobile video traffic to grow more than 17 times from the last six years within the 2015–2020 period.
Of late, Ericsson has been striving to expand its footprint in its key areas of exposure via numerous deals. This month, Ericsson united with Volvo Bus Latin America through a partnership agreement to improve urban mobility in the region. Also, the company inked a contract with a Taiwanese operator to help it develop the country’s 4G network. In addition, this leading communications technology and services provider collaborated with Telstra – Australia’s largest telecommunications giant – for superior performance. Such deals will aid in strengthening the financials of this Zacks Rank #4 (Sell) stock.
Some better-ranked wireless equipment stocks are Harris Corporation HRS, Novatel Wireless Inc. MIFI and Polycom, Inc. PLCM. All the three stocks hold a Zacks Rank #2 (Buy).
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