Citing recent events and European Union sanctions, Ericsson announced it will suspend its business with customers in Russia indefinitely .
In late February, Ericsson suspended all deliveries to customers in Russia, which invaded Ukraine on February 24.
In a short statement on Monday, Ericsson said it’s engaging with customers and partners regarding the indefinite suspension of affected business in Russia.
“The priority is to focus on the safety and well-being of Ericsson employees in Russia and they will be placed on paid leave,” the Swedish vendor stated.
Ericsson is a supplier to the largest Russian operators and it has 600 employees in Russia, a company spokesperson told Fierce. It has no manufacturing there; its manufacturing in Europe is located in Poland and Estonia.
Ericsson said it will record a $95 million provision in the first quarter of 2022 for impairment of assets and other exceptional costs related to the move. No staff redundancy cost is included.
Reuters noted that hundreds of Western companies have either withdrawn or suspended operations in Russia since the country invaded Ukraine in February while Western governments have imposed sanctions.
Last week, Intel said it was suspending all business operations in Russia after an earlier decision to stop all shipments to customers in Russia and Belarus. In early March, Apple reported that it had stopped selling all of its products in Russia.
Smaller U.S. wireless companies are affected as well, including those spearheading the open Radio Access Network (RAN) movement, such as Parallel Wireless.
“Parallel Wireless had a very small team based in Russia responsible for helping us identify MNOs in the region interested in trialing and deploying Open RAN. Given the variety of sanctions, we have suspended all of those operations,” said Parallel Wireless President Keith Johnson in a statement provided to Fierce.
Soon after Russia’s invasion of Ukraine on February 24, the GSMA kicked Russian companies out of Mobile World Congress (MWC) in Barcelona, where they had been scheduled to exhibit February 28-March 3 as part of the Russian pavilion. Around the same time, Ericsson rival Nokia told Reuters it was going to stop deliveries to Russia to comply with the sanctions.
Nokia supplies equipment to MTS, Vimplecom, Megfon and Tele2 in Russia.
The New York Times recently reported that Nokia provided equipment and services as part of a program known as the System for Operative Investigative Activities, or SORM.
Russia’s main intelligence service uses SORM to listen in on phone conversations, intercept emails and text messages and track other internet communications, and the Times tracked documents laying out how Nokia worked with state-linked Russian companies as part of the SORM connection to the MTS network.
Shortly thereafter, Nokia released a lengthy statement responding to the article and denying that kind of involvement. “Nokia does not manufacture, install or service SORM equipment or systems. Any suggestions that we do, are incorrect,” the company stated.
Nokia explained that it’s one of many network infrastructure providers that supplied the Russian market.
“Like any other network infrastructure suppliers, Nokia is required to ensure that the networking products we sell have passive capability to interface with lawful intercept equipment of law enforcement agencies,” Nokia said in the March 28 statement. “All Nokia deals go through a strict Human Rights due diligence process that has been externally assessed and vetted by the Global Network Initiative (GNI). We are the first and only telecommunications equipment vendor to have this external assessment in place.”