WELLINGTON, April 9 (Reuters) - China’s Huawei Technologies Co Ltd has won a contract to build the 4G mobile network infrastructure for New Zealand’s biggest telecommunications company, expanding its presence in the country after receiving the cold shoulder in neighbouring Australia.
Telecom New Zealand said on Tuesday that it had tapped Huawei, the world’s No. 2 maker of telecommunications equipment, to build its network. The network will go live in Auckland, the country’s biggest city, in October, it said.
The contract will bolster Huawei’s presence in New Zealand, where it has built the mobile network for 2degrees, while Vodafone uses Huawei equipment in its fixed line network in the country.
While Huawei accounts for around 70 percent of the world’s 4G deployment, it was barred from bidding for a contract to build Australia’s national broadband network, after the Australian government cited cyber-security concerns.
Industry experts said the Telecom New Zealand contract indicated that New Zealand did not share the same security concerns as its Tasman neighbour about Huawei.
“For Telecom to say they’re going to use Huawei for the national deployment for its 4G means that someone may have had a conversation at the government level, and the government has said ‘You guys go right ahead, we don’t have any concerns,'” said Paul Brislen, chief executive of the Telecom Users Association of New Zealand.
Huawei has increased sales and gained market share in Europe, Africa and Asia, muscling in on rivals such as Alcatel-Lucent SA by offering lower prices.
But it has run into obstacles in countries including Australia and the United States, where it is not allowed to sell telecommunications equipment to domestic carriers. It also faces exclusion from Canada’s government broadband network.
Huawei has repeatedly said that it has no links with the Chinese government, and that it does not believe U.S. security concerns will have an impact on decisions by other countries to use its technology.
Telecom New Zealand said that it had selected Huawei because of its global dominance in network development.
“Huawei’s selection was based on two main factors. The first is that they have extensive experience, having built 73 LTE networks in 42 countries,” David Havercroft, Telecom New Zealand’s chief technology officer, said in a statement.
“The second is that they are truly pushing the boundaries of LTE technology.”
Telecom New Zealand’s announcement comes as it slashes more than 1,000 jobs to cut costs as part of its restructuring efforts, as the company struggles to compete on broadband pricing and in its business operations. (Reporting by Naomi Tajitsu; Editing by Chris Gallagher)