Vodafone takes €200 mn hit due to Huawei
LONDON: British telecoms giant Vodafone revealed on Wednesday that it would cost about €200 million over five years to remove Chinese group Huawei’s equipment from core 5G European activities.
“We have now decided, as a result of the EU (recommendations) and the UK government’s decision, to take out Huawei equipment from the core,” Vodafone chif executive officer (CEO) Nick Read said in a third quarter conference call to reporters.
“It will take around five years to implement at a cost of approximately €200 million,” he added, stressing that the cost would mostly apply to its European activities outside of Britain.
The UK government decided last month to exclude Huawei from core parts of the 5G network and also to cap its share of the market at 35%, insisting that “high risk vendors” would be excluded from “sensitive” activities. The UK’S decision came shortly after Brussels said it also would allow Huawei only a limited 5G role in the European Union.
Read added on Wednesday that Vodafone had a “very limited amount” of Huawei technology in core European infrastructure—but warned it would take time to remove and swap equipment without disrupting customers.
The London-listed company had already decided last year to pause Huawei usage in core systems in Europe.
“On 5G network security and supply chain resilience, I am pleased that the UK process was conducted on the basis of facts and evidence and informed by advice from the National Cyber Security Centre,” Read said.
“Vodafone UK is already largely compliant with these measures and so we have very limited financial exposure, following our decision last year to pause Huawei in the core of our networks in Europe.”
British peer BT said on Thursday that it would take a £500-million hit over five years after London limited Huawei’s 5G role.
Washington has banned Huawei from the roll-out of the fifthgeneration mobile network because of concerns that the firm could ultimately be under the control of Beijing, an allegation it strongly denies.
US officials have indicated that the possibility of China using its commercial presence to spy on Britain -- or even shut down the network -- could force Washington to stop sharing intelligence with London.
A total ban would require huge amounts of infrastructure to be ripped out at great expense.