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Parliamentary Joint Committee on Intelligence and Security
Potential reforms of national security legislation

LEINS, Mr Kursten, General Manager, Strategic Marketing, Ericsson Australia


CHAIR: I welcome Kursten Leins of Ericsson Australia to the table. Although the committee does not require you to give evidence on oath, I remind you that this hearing is a legal proceeding of parliament and warrants the same respect as proceedings of the House and the Senate. The giving of false or misleading evidence is a serious matter and may be regarded as a contempt of parliament. The evidence given today will be recorded by Hansard and will attract parliamentary privilege. You can now make some brief introductory remarks before we proceed to questions.

Mr Leins : I have a quick opening statement in terms of Ericsson and its interest in this particular inquiry. Ericsson was a part of the submission from AMTA, the Australian Mobile Telecommunications Association, and is a member of the Communications Alliance. That was a joint submission which I believe you already had some comments on last week. Basically our views are represented in there and it was not deemed at the time as being necessary to provide a separate statement. What we have since acknowledged—and thank you very much for providing the opportunity to appear before you today—was that the focus on infrastructure, which is Ericsson's core business, is perhaps underrepresented and, to a degree, difficult to place in the public domain in such a public submission. I request, after I have given a bit more information, to make a confidential statement—I believe you refer to it as in camera—regarding some of the technological aspects of some of the suggestions or proposals made within the discussion paper.

CHAIR: How we would describe it is commercial-in-confidence.

Mr Leins : Commercial-in-confidence. Correct, hence us not wanting that in the public domain.

CHAIR: Let's proceed with what we can talk about publicly and then let's conclude in camera.

Mr Leins : I am happy to do it that way. In terms of Ericsson's background, we are the world's largest telecommunications infrastructure and services provider. Basically, we handle 40 per cent of the world's mobile traffic and are represented in over 180 countries. In Australia we have a similar market representation. We have been in the Australian market as a business selling products since the 1890s. Manufacturing has subsequently, with globalisation, gone offshore, but we have had a strong presence here since the 1920s. In terms of a local presence in the market we are very strong.

We also have one of the world's largest patents portfolios, over 30,000 granted patents, and we invest around US$4½ billion annually into research and development. Of course, one of the key reasons for the success on the global scale that we see within the mobile telecommunications industry today—and in the fixed industry, for that matter—is the key focus on standardisation. The reason standardisation is core to what I want to discuss today is that the ability to achieve global standards and interoperability does require agreement at an industry level, so any type of intervention around compliance et cetera needs to bear in mind that global nature of standardisation. It is not just Ericsson that plays there. Standardisation for the telecoms industry generally occurs through major international standardisation groups, of which we are a major driver.

Mr RUDDOCK: So you are suggesting that, if we got a European standard, it would be a good idea to adopt it here.

Mr Leins : Effectively that is what is happening globally, not just in Europe. Ericsson's operations are actually almost as large in the US now as they are in Europe, where it obviously has its headquarters in Sweden. It is probably more being mindful of global standardisation. In the telecoms space particularly, there are two domains. The fixed domain TISPAN is an organisation in the IEEE that looks after aspects of fixed networks. In a mobility space the global organisation that looks after that is the 3GPP, which is the 3rd Generation Partnership Project. That is effectively a group of industry bodies. It is both telecom service providers such as ourselves as well as major telecom service providers who actually deliver those services who, over the period of months and years, actually define standards and requirements that continue to evolve technology to where we are today. A perfect example is the current generation of mobility, what we call in our market now 4G or LTE. Standardisation for that occurred six, seven and eight years ago when the early prototyping started and occurs when agreement is reached on standards in order for products to come to market. It is those sorts of lead times that we are talking about in terms of any type of adaption at a global level. It is not just a single company or entity that needs to look at that; it is as an industry as a whole.

Mr RUDDOCK: So, in practical terms, when I take my mobile phone to America I can certainly use it in some places. There was a time when I could not use it anywhere.

Mr Leins : Correct. That is a perfect example.

Mr RUDDOCK: Is that what you are talking about?

Mr Leins : Absolutely. That applies not only at the device level, and what you are referring to is absolutely based on standards. In the US, until a couple of years ago, we had differing standards. The US has now adopted a global standard, which is why it is far easier to roam to virtually any market with a newer type handset. That applies also to the infrastructure side. Ericsson, you may or may not know, does not provide handsets any longer. We used to have a joint venture with Sony; that has now divested. But on the infrastructure side it is very much about global scale and interoperability that is ultimately achieved through standardisation. Security, of course, is one aspect of that.

Evidence was then taken in camera—

Committee adjourned at 16:32