Huawei wins 3G contract from Telfort
By Alexandra Harney in The Hague
Published: December 9 2004 18:36 | Last updated: December 9 2004 18:36
Huawei Technologies, China's leading telecommunications equipment maker, will build a third-generation network for Telfort, the Dutch mobile operator, its first such contract in Europe.
The deal, announced on Thursday and worth hundreds of millions of euros, marks a substantial milestone in Huawei's international expansion one closely watched by its Western rivals. The Chinese group has been steadily building its business in the Middle East, South America and Asia. The 3G deal will give it an important foothold in Europe. “This is a great step forward for Huawei on our way to become a supplier of mobile solutions on a global scale,” said Ren Zhengfei, Huawei's founder.
Huawei, based in the southern Chinese boom town of Shenzhen, considers Europe a key battleground in its international expansion. Not only is Europe one of the most developed telecoms markets, it is also the home turf of rivals such as Alcatel, Nokia and Ericsson.
The Chinese group will provide a nationwide 3G network for Telfort that can be managed together with its existing network, which was built by Ericsson. Ton ann de Stegge, Telfort's chief executive who only a few months ago expressed doubts about 3G services, said he was impressed with Huawei's product offerings and flexibility. “They demonstrated that they are an extremely successful partner,” he said.
Huawei will set up a research and development centre in Amsterdam. The group, which was founded in 1988, has four R&D centres and more than 20 regional offices in Europe. It has been lobbying local customers intensely to build brand recognition.
Analysts and industry executives who have been tracking Huawei's rise say that, while the group initially competed mostly on price, it increasingly competes with Western rivals on quality as well.
“The technology people are saying that the technology, the cost checks out,” said Duncan Clark, managing director of BDA China, a Beijing-based telecoms consultancy.
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