Gary Pinkham, Vice President, Investor Relations Carl-Henric Svanberg, President and Chief Executive Officer Karl-Henrik Sundstrom, Chief Financial Officer

Kulbinder Garcha, Credit Suisse First Boston Tim Luke, Lehman Brothers Peter Dionisio, Morgan Stanley Hasnain Malik, Smith Barney Citigroup Tim Long, Banc of America Tim Boddy, Goldman Sachs Jeffrey Schlesinger, UBS Warburg Per Lindberg, Dresdner Kleinwort Wasserstein Avi Silver, Bear, Stearns Inc Edward Snyder, Charter Equity Research Jan Dworksi, Handelsbanken Ed Bell, Cazenove Richard Windsor, Nomura International Mats Nystrom, Enskilda Securities Paul Sagawa, Sanford C. Bernstein & Co. Inc

Gary Pinkham, Vice President, Investor Relations: Thank you Operator and hello everyone. And welcome to our conference call for the fourth quarter of 2005. With me here in Stockholm are our CEO, Carl-Henric Svanberg, and Karl-Henrik Sundstrom, our Chief Financial Officer. Before we get started I’d like to remind you that we will be making forward-looking statements during the call today. And these statements are based on our current expectations and certain planning assumptions. And, as you know, the actual results may be different due to a number of factors. And we encourage you to read our Annual Report to understand what these various factors may be. With that out of the way, I would like to hand over to our CEO, Carl-Henric, for comments about our performance and plans going forward. Carl-Henric? Carl-Henric Svanberg, President and Chief Executive Officer: Yes. Let me start by saying that last year was a great year for our entire industry. We had 450m new mobile subscribers in the world. And that brings the total number of subscribers to 2.2b, which is a very impressive number I would say, and far beyond what we thought a few years ago. And we do realize that we’ll soon be at 3b and every second individual in the world will have a phone. And I would think that it’s probably, the mobile phone has become the device that have had a more, biggest impact on people’s lives of any product of that kind. Some 800m new phones were sold. And the mobile phone is now becoming much more than just voice. It is, we have music. We have TV. We have our mobile offices and all of these new features. So, but, and if we look at Ericsson, we had a very good year, an inspiring year with a record profit, the strongest in our history, strong growth and also strong cash flow. And we will come back and comment on the cash flow in particular in the fourth quarter. We have gained market share in basically every area. And, of course, our global presence where we have been in almost all the 140 markets for, not maybe all of them for 100 years, but for a lot of them for 100 years. And our operational excellence continues relentless, to make sure that there is no calorie wasted in any of our workflows or processes. And that is important to support our financial result going forward. And then also the technology leadership, where this year are really clearly ahead of the competition on HSDPA, where we bring 3G technology to another level. But also, in other areas like IMS or Softswitch, which is more of the next generation network’s products and technologies. But more than that, I would also like to comment on services, where we had a growth of 29% in 2005. This was really a breakthrough year for services. We are seeing growing interest across all markets. We have built, expanded or migrated some 800 networks in 2005. We see particularly great potential, an increased potential in managed services, where we do takeover and operate the networks for the operators. And this is, of course, becoming a major focus area, especially in markets with tougher and tougher competition, where OpEx costs, including running the networks, is the biggest cost item for the operator, far bigger than the infrastructure spending. So to lower and leverage the synergies, lower cost for the operator is key. And to leverage synergies with our support services is one way of lowering the cost. It also expands our growth potential in general, because the more networks we manage, the more infrastructure we pull. And the more infrastructure we have out there, the more managed services we create platform for. So, this expands our total platform for growth. The large deals with H3G, in Italy and England, is Ericsson’s largest contract ever and in this way very important to set the trends for the future. We are today managing networks with some 53m subscribers, which is actually a higher number than, for example, Cingular has in U.S. That’s a very big number of subscribers. And we do support some 650m subscribers in networks. If we then go to mobile broadband, which talks about wideband CDMA HSDPA, we have seen the wideband CDMA subscribers triple during 2005 from some 16m to 47m. And the pace of pick-up is growing. And in the end of the year we saw some 130,000 per day added into the world’s networks. And in that respect 3G is really happening now. We have in Ericsson some 83 Edge wideband CDMA networks to date. But we’re also seeing an upgrading towards HSDPA. And we expect most wideband CDMA operators to launch HSDPA in 2006. We have 21 networks with HSDPA capabilities in 17 countries. And together with Cingular we were first to commercially launch HSDPA. And, of course, this is exciting. You can now, in U.S. you can go into 16 different markets and you can buy these cards and you bring your HSDPA services right into your laptop in North America. And this with HSDPA is really taking our consumer services to a new level. We can, you can basically bring in a full TV picture into your laptop. And you can watch a football game, or Formula One racing cars, or something and it has just great TV quality. If we then go to the acquisition of Marconi, of course, having closed that on January 23, from a more hands-on point of view, we haven’t been able to do all that much. But we have worked together with the Marconi staff now for quite a while to prepare the takeover. We have paid the money. And we have met all the customers. And we have merged all the sales forces. And all those matters are in place and all the target numbers, budget numbers for the year are set. It is really strengthening our position in the transmission market. You can see the mobile traffic growth in the picture below, to the left, if you have the picture in front of you. But it shows a dramatic growth in mobile traffic. You can see a similar growth pattern on the fixed side. And all of this traffic on the mobile and fixed side is going to go through the transmission networks that the fixed operators are handling. And there are great needs for upgrades of capacity now that the traffic is growing so much. And that is where Marconi and Ericsson together now is maybe having the strongest portfolio and offering in the market place. But it also gives us a reinforced base for the next generation of converging networks, more installed base, more customer relationships. And then when it comes to the synergies we have only started, but we have come far enough to see that we have realistic targets when we come to our supply chain savings and the overlaps in administration, and so on that we need to deal with. So, we expect synergies to take place on plan. And generally, it’s been encouraging to see all the Marconi customers and see their very positive reactions. And if we then go into the regional update, just to give you a few comments about every region. Western Europe there we see, as you all know, we see a lot of consolidation going on. We’re also seeing tariffs coming down in basically all the markets. Of course, over time that tariff competition will drive traffic and the need for further infrastructure upgrades. But it’s, of course, in a very competitive world where the operators are suffering from lower tariffs. The consolidation as such tends to create a bit of a period of planning, the consolidation and planning the merging of the different networks and so on. And as we saw in Cingular AWS and previously in Latin America, and so on, it tends to create a bit of a softer period before the new merged company starts to really work and we get more investments again. There is a strong focus on services and we have a strong service increase there. Local cost of ownership is in focus with increased tariff competition. It is important to try to hit every area where you can lower your cost base. And the synergies that we can offer between our support organization and the network operations are very interesting to look at. And it’s basically a matter on everybody’s agenda in Europe. We’re seeing an accelerating 3G uptake. Of what we sell of our infrastructure in Europe, some half of it is today 3G and half of it is 2G. And we expect it most to be 3G to be going forward. And we see a lot of upgrades coming on HSDPA. When we look at this all and to the outlook, we are seeing more of a flattish year now, because we are seeing this tariff competition that puts the operators in a bit of squeeze. Over time they will have to deal with the increasing traffic. But short term it will do so. And consolidation may hold back investment as well, so more of a flattish year and then a growth going forward from there. If we then look at Eastern Europe, Middle East, Africa, that is, has shown strong growth this year. It looks like it’ll pass Western Europe as our biggest region in 2006. And already is our biggest region when it comes to infrastructure when considering how much services we have in Europe. This is an old Ericsson foothold. We have been in most of these countries for a long, long time. We are only in the early phase of rollout. There is a lot of subscriber growth coming and a lot of activities there. 3G has started in some of the markets. And, of course, will over time penetrate most of this region. But so far this is very much of a GSM market. If we look at the outlook, we expect next year, or 2006, to be fairly much in line with what we have seen in 2005. If we then go to the next region and look at Asia Pacific. This is a market of quite big differences. It’s, of course, a difference between Japan, or Australia, or China, or India, or Pakistan, or Bangladesh. These are all different markets, with all different growth characteristics. But overall, this is a reasonably strong mobile and broadband growth. We’re also seeing 3G rollouts in many countries besides New Zealand, Australia, and Japan. But I think there are some 13 licenses in the region that is out now for bidding for 3G. And, as we all know, we’re waiting for the 3G licenses in China to come out in this first half year. But as long as that doesn’t happen it puts China in a bit of a waiting mode. We’re also seeing, we’re seeing stable GSM service sales. And we’re seeing CDMA declining as a technology and as an importance of subscribers in China. So, when it comes to the outlook and with all the activities that goes on, it should be higher growth in 2006 than what we’ve seen in 2005. If we then go to Latin America, this is a region that has been under both major consolidation among operators, but also migration from the older TDMA technology into the next generation. And the vast majority have chosen to go to GSM. We have now even seen some 3G planning started and positioning among vendors. But so far it’s primarily GSM market. Over the last couple of years we’ve seen some 60m net adds on GSM into the networks, which is a very impressive, powerful number. It has, in percentage-wise, been our strongest growth region in the last two years. But I think when it comes to the outlook that we have to be realistic. We will not see a growth in this level in, for 2006. But we anticipate to continue to see growth there. If we then finally, in the regional update, say a few words on North America. We, this is the market where we see an intense competition between cable operators and traditional operators on the fixed side driving Triple Play offerings and where mobility plays a very important part of this. But it’s also the leading market in developing and offering new content services. Cingular is here clearly in the lead of mobile broadband and, as I’ve said, have launched their HSDPA services in 16 markets. And 2006 is the big rollout year for Cingular. It is clear that wideband CMDA HSDPA is gaining momentum. And I just read in the Wall Street Journal the other day a journalist that said himself that he had compared an HSDPA service from Cingular with the other available alternatives in the market place. And he concluded that it was simply the best service. So, in light of all the new services that comes out and the opportunities that are there, we expect North America to continue to show good growth here. If we then just summarize this a bit now that we are at the year end, and look at Ericsson’s position throughout the world. It is interesting to just reflect over how evenly spread we are over the world. We have some 25% in Western Europe, some 25% in Eastern Europe, Middle East and Africa. We have some 21 to 22% of our business in Asia Pacific. And we have the remaining 27 to 28% in North America and South America. This very even distribution has meant a lot to, for our strength and our abilities to grow and offset when certain regions have been slower and others have been stronger, and balance our total performance. But that is a good position to have. If we just finish off with a few words on the financial highlights. Sales reached SEK45.7b. And the quarter came in slightly above normal seasonality, I would say. We were up 16% year over year in the quarter, and some 15% for the full year. The gross margin came down another percent from the third quarter, which is a dilution effect from, a mathematical dilution effect with a 29% growing service business. That brings the gross margin down, but not necessarily the operating margin. We continue our work on operational excellence in all aspects of our business. And we could see encouragingly here that where our business was growing 15%, our operating expenses grew by some 5%, and continue to come down as a percentage of sales. And that is, of course, an important work that needs to continue. If we look at then the next slide there, the income after financial items of SEK10.1b with a bit of negative financial net from the negative effects from dividends that I’m sure Karl-Henrik Sundstrom will come back to. But the operating margin was stable and reached 22.7% which is, of course, a bit up from third quarter, which is simply the effect of higher sales. Cash from operations reached SEK13.5b, which was the level that it should be at, reaching SEK19.6b for the full year. But considering that it was a little bit slower in Q3 it was, of course, an encouraging result. But it ended up at the strong close to SEK20b before we do the pension trust funding payout. That leaves us with a net cash of SEK53.4b and the strongest equity ratio for Ericsson over 50% here in modern times. If we then go on to the next slide and look at Sony Ericsson. And Sony Ericsson in general had a good year, a strong fourth quarter and a strong year in total. Sales was up in the quarter 15%, and for the year as a whole 11%. And if we look at units sold we were 28% up in the fourth quarter versus 21% for the full year. And net income reached Euro 356 million for, after tax for the full year, which was a step in the right direction. When we look at the market share we just think it’s interesting to note that we are over 11% in value when it comes to money. And in this industry we often measure the market share in units shipped. And since we are more in the middle to high end, we are, we don’t come out as favorably in that comparison. And we can do all the comparisons we like, but the market share in value I think is a good reflection of our capabilities in sales and marketing and R&D, and it’s worth keeping track on as well. A big success here at the end of the year has really been the Walkman phones. And I think we have taken mobile telephony there to a little bit of another level. And I think it’s a good contribution from Sony also with their brand name and technology there, that shows the strength of this joint venture. If we then finish up with the market outlook, nothing has changed from the third quarter. So, we need to say nothing there. We believe we are well positioned to capture market opportunities. And we expect the mobile systems market in U.S. dollar terms to show moderate growth and the addressable market for professional services to show good growth and in line with previous years. So, that’s basically my comments and I will now hand over to Karl-Henrik Sundstrom for his more detailed financial comments. Karl-Henrik Sundstrom, Chief Financial Officer: Good morning and good afternoon, ladies and gentlemen. I just want to start and do a reflection over four consecutive years of a very solid financial performance from Ericsson. And I think Carl-Henric mentioned most of the things. But I just want to point out one thing here. And that is that, excluding the pension trust funding in the fourth quarter of 2005, we have actually generated more than SEK55b in cash flow during the last three years. That’s a considerable bigger amount than we did during the whole 90s. Next slide please. It’s important to note that Ericsson, and as we have said in this report, that 2005 was a breakthrough year for services. And as you can see, we all grew in mobile networks by 16% when we believe the market has grown somewhere a little bit slower, below 10%. And we are growing at 16%. But it’s in, I want to point out the very strong growth both, in professional services as well as in network rollout services. And that means that the year-over-year growth in those, both service categories are almost 40%. The financial summary on the quarter-by-quarter comparison are demonstrating that we have had basically seven quarters in a row with operating margins above 20%. And we had a margin in the mid, growth margin in the mid-40s. And this is what I would call stable margins. Next slide. The financial performance in regards of cash flow, and we have had a very strong cash flow thanks to high profits, good work with working capital, but also a compensation in certain degree to a negative cash flow in Q3, which means that we ended up with a very strong SEK13.5b in the fourth quarter. And that generated, excluding the pension funding, an operating cash flow of almost SEK20b for the full year 2005. Regarding the operating efficiency trends that we have been following now for the last couple of years, I would say that I’m very pleased with the hard work of our organization to get down to DSO days of 81. I would say that we are within the targets when it comes to payable days. We ended up with 5.2 versus a target of 5.5 when it comes to inventory turnover including working capital. This is an area which has been affected because of the huge number of new networks that we are rolling out. But it’s also an area that we will continue to focus on and I think we need to improve giantly here. Next slide. Sony Ericsson are down there some quarters here but also between two years. And I think Sony Ericsson, as we have seen, have seen growth and expanding earnings. And I think we are as owner, or part-owner, of Sony Ericsson very pleased with this result. And it’s important to note that in the fourth quarter they had a profit margin of around 9%, which is very encouraging. Thank you very much. Gary Pinkham, Vice President, Investor Relations: And Operator we’re ready to start our question and answer session. Operator, we are ready for our questions and answers.

Q - Mats Nystrom: Yes, hello everyone. A two-part question if I may here. You have guided for a moderate growth in the market, which was first guided in October. And you have today I think expressed great confidence in further market share gains, etc. I want to know, you’re not elaborating around order intake and order backlog. But still on that note, is there something you could share with us in terms of trends in order intake, etc, that could prove as evidence to make us believe in your market outlook, so to speak, today? And secondly, on competition and pricing we have seen now Chinese vendors getting some, gaining some grounds in the Western world. And we have seen Nokia coming out with a new base station family. Will 2006 be more challenging than 2005 for Ericsson in terms of price pressure and market share gains? Thank you. Q - Carl-Henric Svanberg: Well, if we start with the first one, when we talk about moderate growth and market share gains. Your question was more related to the moderate growth than maybe our market share gains. But I would say that the activity level out there in the market place is quite stable. And when we guide the market we can, of course, see, we can see the activity level for a couple of quarters, but further than that we can’t see on a detailed level. But I would say we are, there is good reasons for why we make our forecast. When it comes to competition and Chinese, it is clear that the Chinese, they are there. They are, there is a lot of engineering skills growing in the Chinese nation. And it’s, and Chinese vendors will be active and create a position among the leading international vendors over time. Although it will take them quite some time before they are fully fledged vendors and not only can do certain products, but can really drive and load full networks and do system integration and all that. But we, they have come to stay and we will see them gradually build their position. I think we are well equipped to hold on to our position. And we will continue to do what we do well. And I think that will be a good basis for growing our leadership even further. When it comes to what you say about new ready base stations and so on, that’s something that we all at times bring to the market. And we do that and others do that. So, I don’t think that changes much of the competitive outlook. Q - Mats Nystrom: Okay. Thank you.

Our next question today comes from Paul Sagawa with Sanford Bernstein. Q - Paul Sagawa: Hello, if I may a quick clarification and then a question. The clarification is the tax rate was obviously lower in the quarter. If you could give us a straightforward guide as to what we should have in our models for 2006? And as for the question, so for the year with, you have 15% top-line growth and 5% growth in operating expenses. That creates nice leverage to the bottom line. Going forward can we anticipate with guidance for yet another strong year in the top line, with some room for interpretation in 2006. Would we anticipate that the ratio of expense growth to sales growth, assuming all goes well, would be in the same territories? Are there any particular reasons you see why you’d need to either ramp up your R&D spending or sales and marketing activity relative to sales in ’06? Or likewise, any reason where you thought you could get more leverage in 2005? Thank you. A - Karl-Henrik Sundstrom: Regarding the tax, as we said in the comment, is that in 2004 we had approximately 32% tax rate. During this year we have had an average for the three first quarters of around 32%, which we believed was the position we would end up in 2005. But then in the fourth quarter certain tax position went our way and things that we had anticipated didn’t happen. That brought down the tax rate to 14% in the fourth quarter. Going forward I, the ones we are using internally is 30%. Q - Paul Sagawa: Thank you. A - Carl-Henric Svanberg: To OpEx and sales, we are not giving any particular guidance. But I can just confirm that we are working very intensely with operational excellence matters in everything we do. And there is no reason to believe that we have got to the final stage of that and everything is great. So, should we have OpEx growing in line with sales, it would be a bit of a disappointment. We have also ambitions on the R&D side where we believe that we can work more efficiently and more with operational excellence as well. It is not so that people aren’t working hard. They’re incredibly hard-working people in our R&D organization. But it’s more the fact that we can, we believe we can work smarter, and get more of their time spent on real innovation and development, and not so much on other matters that are related in testing and verifying and remaking and so on. We can simply be more efficient there. So, we expect that we, with basically the same R&D level, should be able to increase the output for the increasing needs that we see. So that should also help us in this respect. Then I think in all fairness also, because we should always be straight, when services is growing, which is part of the growth here, it does not pull the same amount of OpEx load as the infrastructure growth does. So, only that is the reason to keep OpEx growth lower. Q - Paul Sagawa: Thank you.

We now have a question from Kulbinder Garcha with CSFB. Please go ahead. Q - Kulbinder Garcha: Yes, thank you. Could you perhaps give us an update on, now that you’ve done the budget-setting, on Marconi as to how revenues might fare? I’m thinking particularly in ’06, because they obviously have lost part of the BT contract and revenues will decline. On the other hand, you have as a trend ran their products through your distribution into your new, to the wireless customers. And how quickly that might ramp up? And is it fair to assume that sales there decline before they recover in ’07? How might margins trend? Please could you give us an update as to what your most recent thinking is there please? A - Carl-Henric Svanberg: I would say when it comes to Marconi we have, as our own estimates, we have said that we expect flattish sales for Marconi for this year as a combination of several factors. Because when you take over a company, there are always opportunities and disturbances in such a process. On the more positive side it is clear that they have a very strong offering on the transmission side. And have been able to reach out to a handful of markets or a dozen of markets around the world in a meaningful way, whereas we are well established in 140 markets. So, when you see the combination of their product program, the strong geographical sales network of Ericsson and the growing need for transmission, we’re growing traffic. That’s a quite inspiring outlook. At the same time, as you say, a merger and so on, it does create disturbances. And I’m sure there are customers we lose in the meantime as well. But all in all, I think it’s a cautious outlook with flat sales. And when it comes to our synergies and our ambitions to keep EPS flat for the year and to reach growth, reach targets, operating margin targets for the Group, over time I think there is no change. Q - Kulbinder Garcha: Okay, thank you.

We will now take a question from Tim Luke with Lehman Brothers. Q - Tim Luke: Thanks. A question for Karl-Henrik. You said about the revenue being slightly than the normal seasonality. I was wondering, when we think about the beginning of the year 2006, should we think about fairly normal seasonality? Perhaps you could give us a framework for what you think that has been in terms of normal seasonality, although clearly recognizing that you’re not providing too specific guidance? And I was also wondering with respect to the gross margin line, where gross margins seem somewhat softer, could you give us a framework for thinking about that going forward? Should we think about it ebbing slightly lower from this current level progressively as we move through and services become a greater part of the mix? Or, maybe how should we think about that at the beginning of the year? Thanks so much. A - Karl-Henrik Sundstrom: We do not give short-term guidance on sales. And I would like to stay with that. And when it comes to the gross margin, and we have stated a number of times that obviously the gross margin is lower in services. But you don’t have R&D, and basically no R&D and you have lower other OpEx, which means that they have, professional services have a competitive operating margin. So, if services continues to grow in the pace it’s doing, it will have an effect on the gross margin on the negative side, but not on the operating margin. Q - Tim Luke: Maybe, Karl, you could just say what has normal seasonality been for you, just so we have a sense of that? And whether you think there are any factors that might be particularly pertinent outside of that? A - Karl-Henrik Sundstrom: It’s been 24%. Q - Tim Luke: Over what period? A - Karl-Henrik Sundstrom: Three years. Q - Tim Luke: That’s very helpful, Karl. Thank you.

Our next question from Peter Dionisio with Morgan Stanley. Q - Peter Dionisio: Thank you, just a quick question on SG&A. Prior to 2005, SG&A as a percent of revenues typically declined in Q4 compared to Q3. Could you just comment on what caused SG&A as a percent of sales to be higher in Q4 compared to the previous quarter? And then just a very quick follow-up on one item. Your high margin other operating revenues, you showed SEK836m this quarter. In the past you’ve indicated sustainable run rate of SEK300 to SEK500m per quarter. Why would this run rate not go up as we have more 3G take-up? Thanks. A - Karl-Henrik Sundstrom: When it comes to this, the licenses coming in remember that in Q3 we had actually an accrual for Sony Ericsson who paid basically two quarters in one. And historically we’ve had a higher increase in the fourth quarter, but that came in the third quarter this year. And then, can you repeat your first question? Q - Peter Dionisio: The question on SG&A, we’ve noticed that in the past the SG&A as a percent of revenues, it typically declines in Q4 compared to Q3. But….. A - Karl-Henrik Sundstrom: What we have seen this year and last year, it has been between 10 and 11%. This quarter it went up to, I think, 11.6% or almost 11.7%. One of the reasons is that we had slightly higher than anticipated sales. We also had a lot of people reaching their, or collecting their sales commissions. But also we had some start-up costs in certain markets that we accrued for as accrued expenses in the fourth quarter. Q - Peter Dionisio: Okay, thank you.

We will now take a question from Has Malik with Citigroup. Q - Hasnain Malik: Hello. You kindly talked about your outlook for Western Europe. And I just want to ask how concerned are you that, as 3G really accelerates, we actually get a dramatic reduction in 2G related upgrades. And in that respect, what lessons would you draw from the evidence, or the experiences you’ve had in an advanced 3G market like Japan? Thank you. A - Carl-Henric Svanberg: Well, I think we will, we would, I would almost turn it a little bit the other way, because what is happening now is that 3, the 3G pick-up is accelerating now. And at the same time tariffs are coming down. So, I would say that operators will very likely do whatever they can to force that transition from 2G into 3G, at least in such a way that they don’t have to expand their 2G networks first and then build 3G networks. But that is a, I think that’s the ambition that any logical operator would have. We have only started to cover the, Europe with a rather thin network. So, of course, that would be 3G upgrades instead and that’s not a big difference. So I think the general outlook for the European market in light of, first this consolidation, but also the falling tariffs, is pretty positive outlook, I would say. But a bit of a waiting mood and more flattish this year. And I know that we said in New York on our Capital Market Days, that flattish or even could be slightly down and we haven’t really changed that perspective. That is somewhere we, our guess is flattish but if anything it could be going slightly down rather than up. Q - Hasnain Malik: Okay, thanks.

Our next question comes from Tim Long with Banc of America. Q - Tim Long: Thank you. Just a question on some of the larger potential deals out there for 2006. If you could just comment on what you think about timing and potentially pricing, or margins for these deals? So if you could just talk a little about some of the big contracts coming out in India, and how you think Ericsson will fare there? And just also what you're hearing, not necessarily on timing of the 3G, but what you would expect to see as far as economics for some of those deals? Thank you. A - Carl-Henric Svanberg: Well, I would say first that, of course, if you are a smaller player, a smaller vendor in this world, a larger contract can maybe make a bigger difference to your performance. But considering how well spread we are and the size of Ericsson I think sometimes, at least for us, there is an over-focus on certain deals that suddenly become public. Often become before, that because they’re public companies. In India you have a handful of operators that are investing as much. I'm sure you're thinking about the BCNL contract, and so on. So, but when it comes to these particular contracts, the price battle that happens in these contracts, and that goes for many others as well, that does reflect the upside, and it reflects the future position you create. So the more future potential there is, the further probably the vendors are willing to be stretch themselves, to be part of that future business flow. Because you do start a very long-term managed-like relationship and so on. So I wouldn’t say that there is any difference in the larger contracts, only that we’re more outside Europe sometimes willing to stretch further. Q - Tim Long: Okay, thank you.

We will now take a question from Tim Boddy with Goldman Sachs. Q - Tim Boddy: Yes, thank you. I’d like to ask questions in, along similar lines, really about the upside you see in services for this year, and about the margin implications for that. What major contracts do you see available for 2006? Obviously I'm sure you won’t name them, but it seems to me that we’re really at an inflection point in this market. You’ve talked about a breakthrough year. We could see maybe another couple of deals, perhaps even of the size of the three U.K. or three Italy deals. And secondly, could you help us understand how margins on those deals work? Traditionally in outsourcing deals there are some upfront costs which then take time to work through, and you reach profitability based on preset targets. Is that going to be the same with these contracts? Thank you. A - Carl-Henric Svanberg: The larger deals. I think it is right to say that we are in a bit of an inflection point. At the same time these kind of deals are such that they are not easily decided upon for a major operator, because it’s a big decision for him to put out the network on outsourcing. At the same time the synergies that are there, if we are a major supplier in the network, between what we do and he does, is so big so that the savings is compelling. So I would say that there is hardly any operator in Europe that isn’t seriously considering it today. He may choose something else, I don’t know, but it’s certainly something we talk with many operators on. And the time it then takes for them to materialize their ideas and start more serious discussions, I think it’s hard to say. But it is clear that where we are at some point of a, some kind of an inflection point, and we need to see how fast it changes. When it comes to the deals, there are elements of what you're saying. There could be elements of initial cost that we take and so on, and it depends a little bit how you choose to set up the contract and so on. But we try to be very conservative in these contracts, and make sure that we take the costs we can upfront and so on. And then lay the foundation for a good development of the contract as such. And that also reflects the synergies that are involving cost that needs to be reduced, and it does take some time to reduce those costs. So the earnings does improve over the lifetime of the contract. Including also matters like right to use sites, where we can rent out sites, space also for other competing operators, with the acceptance of our partner. And we can use the sites for others as well as ours. So there are costings and there are a business matters that develop in a positive way during the lifetime. A - Karl-Henrik Sundstrom: Yes, I now would like to add also that it’s a lot about cost, but it’s equally about scale. Take the Italian and the U.K., network for example. They, the nightshift there we run from Australia where we already had Hutch as the managed services. So using Ericsson’s scale is also very important factor. So we have established a huge footprint already in this kind of business. Q - Tim Boddy: In terms of the competition you see for these contracts, how do you feel about your cost position and the cost proposition you can offer to the operator, compared to your competitors? A - Carl-Henric Svanberg: Well, I think it is, there are two things here. One is that we are not really competitors to our traditional competitors. Because what you do is that you can do these services, managed services contracts, where you are the major supplier or where you are about to become the major supplier. But without being in the future the major supplier you won't have the synergies to leverage. So the real alternative is normally for the operator to keep it inside. Of course there are times when we may be, say, a 50/50 supplier with someone else. And in those instances we could directly be a competitor. The other aspect of it is, where we are in - versus competition in our skills and abilities to do this, and there I can say that we are clearly ahead. We are far down the road in developing our abilities to do this in a big scale, whereas the other ones only are starting to develop their abilities. Q - Tim Boddy: Thanks very much.

We will now take a question from Jeffrey Schlesinger with UBS. Q - Jeffrey Schlesinger: Thank you. The Western European business was up pretty strong sequentially, I think this was talked about earlier. When you look at your order book and your reference, you see that clearly in the market. Would you expect the Western European market to continue the downward trend, down 4% in the fourth quarter? Would you expect that to continue in the first half? And also on the network rollout business, which showed a 50% growth 2005, and obviously a multiple of the mobile networks business overall. Would you expect that business also, given your visibility, to continue this hyper-growth, if you will, as you take part in these new networks? Thank you. A - Karl-Henrik Sundstrom: Well, I don’t think we’re not going to give any more guidance than the ones that we've had. I think we've given the guidance for Europe as a whole for the year, and we don’t provide guidance neither for us at all or for particular quarters. So I don’t think we have anything to add onto your question. Q - Jeffrey Schlesinger: And on the network rollout business overall for 2006, in terms of the growth there based on your visibility of new networks? A - Karl-Henrik Sundstrom: If your question is the following, the network rollout business has had a high activity during 2005, and that’s a reflection of our market share growth and that we are building up a number of networks. So I think that will have a high activity level going into 2006 as well, because there's a number of new networks who are going to be built during 2006. For example, there are three new licenses in Japan. We have 3G in China, etc, etc. Q - Jeffrey Schlesinger: There’s still a very high growth expected.

We will now take a question from Per Lindberg with Dresdner Bank. Q - Per Lindberg: Morning, good afternoon. There have been a lot of speculations surrounding the timing, of course, of China and 3G, and we do know that the two gigantic operators are preparing to deploy on a big scale, i.e., China Telecom and China Netcom. We have also seen what impetus you have got from Cingular. I surmise that you are not penciling in much from China 3G into your revenue outlook for the industry at large for 2006? But then presumably the big momentum will come the following year, 2007? Could you shed some light on how big an impact the incremental operators, China Telecom, China Netcom, could have had? From our perspective it ought to be at least annualized investments to the tune of $2.5b each, just as a crude reference. Thank you. A - Carl-Henric Svanberg: Well, this is, I think it’s the right conclusion that, or it assumes starting with licenses, if they come up sometime during the first half you wouldn’t expect too much to happen in the second half, when it comes to sales. This is, however, a little bit unusual situation because I think everybody is on their toes there and wants to run. So there could be somewhat quicker than you would normally, of activities building up than normally you would find after license award. But principally I think your comment is right. When it comes to how quickly the others start to spend, that’s also a matter that one can only guess on a bit but, and it’s right that China Mobile, with all their networks around China, is likely to be more softer in how they will out because they already have a network. So they can fix it just one by one or they can do something, go more by regions in a controlled way, as we are seeing at, when Cingular does it or when someone else does it or whatever. But the other operators you mentioned, they’re coming up from scratch. So they have to get some sort of countrywide coverage rather quickly and that, of course, involves more equipment. So they could pull a lot of business. But I have no comment really to your number there, Per. Q - Per Lindberg: No, thank you. But is it fair to assume that, should we get four operators, two of whom are starting from scratch from these depressed levels, that the Chinese market overall can double in size? A - Carl-Henric Svanberg: Yes, I don’t know. It’s, first of all, I haven’t heard for quite a while about four networks. I think I've heard more about three networks where China Unicom, in whichever shape it will prop up the network and who will own it, will be the basis, and see the main network will be the basis for one license in China Mobile, the other one. And then the other two operators are likely to, the latest rumor I've heard is that they will split maybe China in two parts. So one shouldn’t maybe draw too dramatic conclusions there. But three networks is probably what we’ll see. Q - Per Lindberg: Thank you.

Our next question today comes from Wojtek Uzdelewicz with Bear, Stearns: Q - Avi Silver: Hi, it’s actually Avi Silver for Wojtek. I have two questions. First of all my question relates to Marconi. I realize that you closed, just closed the transaction just a few days ago and you may not have finalized the exact plans for integration. But I wanted to ask whether you see any major restructuring, specifically any major charges as it relates to Marconi? Also just a housekeeping question. Does your flattish forecast for the Western European market include the services portion? Thank you. A - Karl-Henrik Sundstrom: When it comes to the outlook for Western Europe, that is for mobile systems, for mobile infrastructure. So it excludes professional services. Q - Avi Silver: Okay, and relating to Marconi and any potential charges there? A - Karl-Henrik Sundstrom: I think we have answered that question in a previous question but I will answer it. So what we have said is that we acquired the company a week ago formally, and we are working and the integration plans are according to plan. And we, for the full year we anticipate to be EPS neutral and, of course, there will be slightly different impact in various quarters but that’s all we are saying so far. Q - Avi Silver: Okay, and is that net of any charges or….. A - Karl-Henrik Sundstrom: It’s EPS, so it’s net. Q - Avi Silver: Okay, thank you.

We now have a question from Edward Snyder with Charter Equity Research. Q - Edward Snyder: Yes, thank you. In terms of tariff consolidation, obviously we’re seeing some in that Europe. Your forecast is for flattish growth. What does your forecast include in terms of additional consolidation? Are you anticipating any additional column consolidation, especially in Western Europe? And with regard to worldwide, are you looking for, after the initial rollout of the HSDPA services in the U.S., so 2006 would be a strong year. If we look at what's going on with Verizon, it’s slowed some big spending in, of course, Vodaphone. Do you anticipate, after the rollout of these services, that you'll see a significant slowing in spending as they start to absorb more subscribers, and wait to see how growth is after that? So your forecast for North America, if we could extend it out a bit, how does that anticipate the build-out of HSDPA after this initial rollout? A - Carl-Henric Svanberg: I think we are, when it comes to networks, I think there are, we sometimes overestimate the capacity in the early networks that we do roll out. We, it is not for, without a reason that we are supplying, that we’re delivering the highest volumes of GSM equipment ever in a technology that we introduced 15 years ago. With large volumes also going into Europe, and additional capacity going into Germany and so on. We have only started in that sense in United States and it’s the first initial rollout. So the project itself has a duration for 2006 and 2007, but there will be many years of expanding those networks as we go on. When it comes to consolidation, I think it’s natural that we will see more of it. It is a little bit hard to actually, to precisely predict. Because if you look at North America with maybe, four, five large operators in total serving that whole continent, and then you look at Europe which has three, four operators in every single country, of course there is a consolidation need. But at the same time the real synergies and overlaps are when two operators in the same country merges. If someone in Southern Europe is buying someone in Northern Europe, the synergies are not as compelling. But I think there are both reasons for consolidation and also reasons that it’s held back. But certainly consolidation will continue. The synergies in this industry’s just too big. Q - Edward Snyder: So does your forecast for Western Europe anticipate additional consolidation? A - Carl-Henric Svanberg: Well, I think the whole environment right now is step-by-step consolidation and we do continue to see that. I think every step that is taken by someone puts pressure on someone else. So I don’t think we've taken the final step there, and so I think we have reason to expect more. Gary Pinkham, Vice President, Investor Relations: Next question, Operator?

The next question comes from Jan Dworksi with Handelsbanken. Q - Jan Dworksi: Yes. I have a question related to, if you see how your share of 3G sales in relation to 2G in 2006, do you see that having an impact on either gross margins or operating margins? A - Karl-Henrik Sundstrom: Well, we are, it’s fascinating now that, considering where we were a few years ago when the volumes were very low, we’re getting close now with the margins to where 2G is. So, as volume expands I think we have that basically out of the loop. Q - Jan Dworksi: Okay, thank you.

We now have a question from Ed Bell with Cazenove. Q - Ed Bell: Yes, just one clarification. The other provisions line seems to have dropped quite sharply in the quarter from Q3 to Q4, about SEK3.6b. I wonder if you could just highlight what that was? Was it, is your spending on restructuring unwinding, anything like that? A - Karl-Henrik Sundstrom: That’s normal movements of provisions, and they have all been consumed that, which means that they have had no impact on the P&L but they have been impacting the cash flow. And as I said at Q3, we did have a lot of movement with the big projects. Q - Ed Bell: It’s the biggest movement in provisions for the last three years. A - Karl-Henrik Sundstrom: Yes, and it’s also the biggest sales in any quarter in the last couple of years, and especially on, with the huge mix of big networks being rolled out. Q - Ed Bell: So it’s risk provisions against large networks, is that what it is? A - Karl-Henrik Sundstrom: To some extent, yes. Q - Ed Bell: Okay, and you made a comment earlier on about start-up costs affecting the SG&A line. Is that starting up new marketing and sales operations, or is that the impact of swap-out costs on SG&A? A - Karl-Henrik Sundstrom: It is not project costs because project costs you can only start up when you have an order. But these are marketing costs and start-up costs of marketing activities, and preparing for big tenders. Q - Ed Bell: Okay, thank you very much. Gary Pinkham, Vice President, Investor Relations: With that Operator, that’s our last question, I think. Hello, Operator?

We can have a question from Richard Windsor with Nomura. Q - Richard Windsor: Hi, good afternoon. Just looking at what you’ve been talking about in terms of net adds. You said that 450, you had 450 net adds this year, and obviously given that you were expecting 3b some time before 2010, you would seem to think that the net adds would slow substantially in 2006. I was just wondering would have that a negative impact on the rate of traffic growth, and if not, what would make up the balance for lower net adds? Thanks. A - Carl-Henric Svanberg: Well, I think that if it is something that this industry has done, is that it has surprised us in its growth capabilities, both in terms of speed and saturation level. It’s, three years ago we talked about 2b as a saturation level. We have talked about 3b now as the new target before 2010 and, in fact, I think it’s more obvious that we will pass 3b in a couple of years than anything else. And, but we’ll have to just wait and see there. And how far it’s going to go beyond that. I think it’s partly dependent on how, if we continue as an industry to develop more cost-efficient solutions which we do all the time. If we, if you take technology from five years ago and the cost levels of both the technology itself and the deployment, and the way we ran the systems, we couldn’t hardly run a profitable operation for an operator at $4 or $5 in ARPU that we are seeing today. But now it’s possible and that opens up new markets, and we’re seeing handsets being sold at $30 or less, or down to $25. So it keeps opening up new markets. So I don’t think your concern is one of our major concerns. Q - Richard Windsor: Okay, thanks very much. Gary Pinkham, Vice President, Investor Relations: With that Operator, we conclude our conference call today.

Ladies and gentlemen, that will conclude today’s question and answer session. I would now like to hand the call back over to you, gentlemen, for any additional or closing remarks. Gary Pinkham, Vice President, Investor Relations: Thank you, Operator. I think we’re finished for today but I can remind you that in May 10 and 11 we have our Capital Markets Day in New York. And there will be an agenda and registration information on our website in the next couple of weeks. Look forward to seeing you then. Bye.

Thank you for participation ladies and gentlemen. That will conclude today’s conference call. You may now disconnect.