Three selects Huawei for network management

10 December 2012 | Kavit Majithia


UK mobile operator Three has outsourced the management of its core network to Chinese vendor Huawei.

It is the latest indication that an increasing number of businesses deals in telecoms are being struck in Asia.

The contract term spans five years, at a value of £120 million, and Huawei has been contracted to deliver service management and operations for Three’s core network in the UK.

Three’s network was previously managed by Swedish vendor Ericsson.

Huawei’s deal with Three is a prime example of the company’s diminishing market share as a result of the Chinese company’s worldwide expansion.

Huawei now has 240 contracts in over 60 countries, but it has come under scrutiny this year particularly in the US, where claims suggest the company is a security risk.

Analysts are noting a significant shift in the industry, with European rivals, including Ericsson, Alcatel-Lucent and Nokia Siemens Networks beginning to suffer in the highly competitive and commoditised market. Huawei’s second half year results this year exceeded those of Ericsson for the first time.

As a result of diluting workloads with workforces in the UK, Huawei’s deal with Three has lesser terms than the mobile operator’s original deal with Ericsson.

“The decision to select Huawei to manage core network operations follows a rigorous procurement process,” said Dave Dyson, chief executive of Three UK. “We chose our partner that best met our requirements which matched our long-term vision of how our network should be managed.”

Huawei confirmed plans to invest £1.3 billion and create 500 jobs in the UK to build its business in the country. “Huawei has now been in the UK for over 10 years and by focusing on the needs of our customers, we continue to develop and grow our business,” added Victor Zhang, chief executive at Huawei UK.