Top Chinese telecom equipment manufacturer Huawei
Technologies yesterday announced it had secured a deal to supply equipment to
Vodafone Group Plc's third generation (3G) mobile telecom network in Spain.
The deal is a landmark for Huawei, which is seeking to expand in Europe, one
of the most competitive mobile markets in the world.
Huawei beat Ericsson, the world's top telecom equipment maker, to win the
deal, which will see it deliver and install the radio access part of Vodafone's
3G networks in "certain key cities in Spain," the firm said in a statement.
Company spokesman Fu Jun said that the deal represents "a major breakthrough"
for Huawei.
The firm, a latecomer to the global telecom market, originally focused on
developing countries.
But the Shenzhen-based firm has shifted its attention to Europe in recent
years, a market dominated by established telecom equipment makers such as
Alcatel, Ericsson, Nokia and Siemens.
The deal with Vodafone, the world's largest mobile operator by revenue,
underlines the increasing recognition Huawei is winning from major global
operators.
In December 2004, Huawei won a contract from Dutch operator Telfort to build
a 3G network in the Netherlands.
Vodafone chose Huawei as one of its five preferred suppliers last year, and
awarded the Chinese firm a 3G network equipment supply contract in the Czech
Republic.
Vodafone Spain has more than 1.2 million 3G subscribers and is one of the
most important and strongest performing operating companies in the Vodafone
Group, according to Huawei.
Spain has one of the fastest growing 3G subscriber rates and highest average
revenue per user (ARPU) rates for operators a major benchmark in the telecom
market.
"Huawei's innovative solution within the radio access network, fully
addresses our requirements for deploying a world-class 3G broadband network,"
said Helmut Hoffmann, Vodafone Group's director of Global Networks.
"The solution enables us to significantly reduce our operating costs,
maximize the benefits offered to customers and improve our competitive position
in the marketplace."
So far, Huawei has secured 30 commercial contracts based on the WCDMA
(wideband code division multiple access and HSDPA (high-speed downlink packet
access) 3G technologies.
In February, Vodafone signed a five-year global supply deal with Huawei for
exclusive Vodafone-branded 3G handsets, which will be sold by Vodafone in 21
countries.
"As a strategic partner of Vodafone, Huawei will combine its technological
know-how and leading solutions with its customer-driven service capability to
strengthen Vodafone's leading market position," said Huawei Europe President
William Xu.
Company spokesman Fu Jun said Huawei is currently discussing network
equipment supply contracts with a host of European operators.
"The proven track record with the world's top-tier operators will also give a
boost to Huawei's competitiveness in China's future 3G market," Fu said.
Huawei recorded annual sales of 45.3 billion yuan (US$5.6 billion) last year,
while its contract sales hit US$8.2 billion.
Fu said Huawei expected its contract sales to reach US$10 billion this
year.
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