Huawei muscles in on VHA mega deal

Vodafone Hutchison Australia (VHA) has said it is close to finalising a massive tender for the management of the mobile giant's merged 3 Mobile and Vodafone networks.

VHA CEO Nigel Dews
(Credit: Suzanne Tindal/ZDNet.com.au)

Champagne or tears are likely to flow for the Australian arms of Nokia Siemens Networks and Swedish vendor Ericsson, the incumbent network management service providers of Vodafone and Hutchison respectively; VHA has reached the final stages of a selection process for a vendor partner to move into the future. To make things hairier, VHA has pitted the two European companies against the industry's low-cost alternative, Chinese networking behemoth, Huawei.

"We're actually just about at the end for the RFP (request for proposal) process for our core and managed services," VHA chief executive officer Nigel Dews said at a media briefing for its half-year earnings update. "It's been a terrific process which has involved Huawei, Ericsson and Nokia Siemens," he said.

The deal is set to be a major boon for the winner. It will be one of the largest to go up for grabs this year, covering a period of seven years and likely open to just one supplier, given Dews' reference to a "partner".

"We're close to the end of that process, and we'll hopefully soon be able to announce who our partner is on the network management side going forward," he said.

While Huawei has been boosting its presence in Australia in preparation for the Federal Government's $43 billion National Broadband Network, Ericsson and fellow networking giant, Alcatel-Lucent, have faced tougher times, both recently cutting back staffing levels.

The NBN is set to be a return to better times for the industry, which has remained flat since Telstra's multi-billion-dollar Next G and Next IP upgrades and Vodafone's own network upgrade were completed.

Meanwhile, the sector's greatest hope for future investment, LTE (Long Term Evolution) or 4G, is on hold as the Federal Government gears up for its spectrum auction due in 2012. Dews today said he did not expect LTE to become available in Australia for some time.

"We will probably begin [LTE] trials at the end of this year or next year. We're very keen to ensure that in the upcoming spectrum auctions we have enough spectrum to be an effective LTE player in the long term. We won't be at the bleeding edge of the LTE roll-out. We will do that when handsets and devices are good for the market. And that is some way off," he said.

Yet Dews offered hope for the losers of the long-running contest to win VHA's network management deal. "All [the bidders] are cognisant of the fact that there are more RFPs available," he said.

The next stage RFPs to be issued by the company included its work for its Radio Access Network, transmission and IT services, according to the executive.