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Ericsson will not make call at Cebit

Workers place a large replica of a mobile phone in position ahead of the opening of Cebit, the world's biggest information and computer technology fair, in Hanover, Germany, yesterday. PHOTO: AFP

A US$2.53 billion loss for 2001 didn't stop Ericsson AB from financing a booth at the Cebit technology fair last year. It's skipping the show this year after a US$2.27 billion loss last year, and it's not alone.

Cebit, the world's biggest technology fair, will shrink for a second year as fewer European and US companies travel to Hanover, Germany, this week, three years after the NASDAQ Composite Index peaked at 5,132.52. The number of exhibitors and visitors will drop by about 10 percent this year, the show's organizers said. The NASDAQ closed at 1,305.29 on Friday.

Adobe Systems Inc canceled its stand at the show three weeks ago, after construction of the booth had begun. Ericsson, the world's largest maker of wireless networks, which sent the head of its European unit last year, is narrowing its focus to conferences for the telecommunications industry, such as the 3GSM World Congress in Cannes, France, last month.

"We're prioritizing Cannes and the Geneva fair in October," Ericsson spokeswoman Aase Lindskog said. "That's where we think we can reach our customers."

Companies are deciding where to channel limited resources as the economy of the dozen nations sharing the euro may contract this quarter and US consumer confidence slumps to a nine-year low. ThyssenKrupp AG, Germany's largest steelmaker, turned down attendance at this year's industrial trade fair, also in Hanover, as it seeks to rein in costs and focus on smaller shows.

The number of exhibitors at the Cebit, which attracted more than 8,000 organizations in 2001, will drop 10 percent to 6,526, spokeswoman Gabriele Doerries said. The 18th annual Cebit show, which runs March 12 to March 19, will feature new products and technology announcements from companies including Microsoft Corp., Nokia Oyj and Samsung Electronics Co. Companies pay 180 euros (US$199) a square meter to exhibit at Cebit. The price is discounted to 164 euros for a four-year contract. Visitors pay 35 euros for a Cebit day pass bought at the door, or 78 euros for a pass for the duration of the show.

The cutbacks by corporations such as Ericsson come as the information technology and telecommunication industry in Europe is expected to grow 2.5 percent in 2003, according to the European Information Technology Observatory. Technology spending in North America is seen climbing 1.9 percent this year, according to a study by Forrester Research Inc.

The number of software companies exhibiting at this year's Cebit will decline from a year earlier. SAP AG, the world's largest maker of business-management software, will focus more on mid-sized clients than in prior years. Its US rivals Oracle Corp and Siebel Systems Inc will be represented through partners.

"We will meet many customers that we normally couldn't speak to -- mid-sized clients for example -- and there will also be a lot of partners there," SAP Co-Chief Executive Officer Henning Kagermann said in an interview with Bloomberg Television on Friday. He said the market is "still difficult."

Adobe, the world's largest maker of software used for publishing and graphic design and a Cebit exhibitor since 1994, pulled out this year because the show is too broad, spokeswoman Holly Campbell said. The company will participate in trade shows that are more targeted to their customers such as Seybold and MacWorld.

Between 600,000 and 670,000 people are expected to attend Cebit this year, down from 674,000 attendees last year, Doerries said. Some regular visitors to Cebit said they won't attend this year or will cut their trips to the fair short.

"I won't be able to spend so much time at the Cebit this year," said Ralf Hallmann, a telecommunications analyst for Bankgesellschaft Berlin.
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