The growth in number of subscribers, for digital systems in particular, is very rapid throughout the world. The mobile telephone business is developing favorably, with strong demand for GSM products. Ericsson is strengthening its position as the leading supplier of digital mobile telephones. As a result of strong pressure on prices and delays in China, the business area's sales declined and profitability was weak. The process of change, designed to shorten lead times and reduce costs, is continuing.
Profitability is still weak.
The market has shown very strong interest in the business area's DECT-based radio access system. Product areas in which there is strong demand include telecommunications cable, energy systems and microelectronics for mobile telecommunications systems. The volume of business in the telecommunications field are increasing in all markets. The market for defense electronics is still pending. During the third quarter cash flow was neutral.