Ericsson, which employs almost 2,500 people in the Republic, has withdrawn its first shipment of new-technology GPRS mobile phones due to a flawed factory installation.

The flawed phones, Ericsson's recently introduced R520 model, had been sent to retailers in Sweden and one or two other European countries.

The withdrawal is an embarrassment for Ericsson, which has suffered a loss of market share in mobiles recently.

General packet radio services (GPRS) technology offers mobile phone users a fast Internet connection and always online capability.