5G network

Network builders say sales are not just about cost. Mobile infrastructure companies believe that LTE networks will be substituted with higher capacities, lower-latency 5G networks in Asia in the next few years. The new 5G networks will be the background for applications ranging from mobile e-sports, autonomous car communications and virtually monitored robotic operations.

However, if companies want to develop some Asien markets, Samsung, ZTE, Nokia, Ericsson and other suppliers of equipment will have to compete against Huawei’s low-cost services.

In the context of global 5G trading, only Nokia from Finland and Ericsson from Sweden are close to the Shenzen-based company. In comparison to Nokia’s 38 and Ericsson’s 18, Huawei published 40 deals publicly. But Huawei has spent around $15 billion in R&D in 2018, much more than Nokia and Ericsson’s combined $9 billion.

This massive expenditure gives Huawei the ability to make lower-cost chips and routers.

“This is one of the reasons why European operators were reluctant to ban Huawei’s kit completely.” Nokia and Ericsson told Cybersguards that their key to competing in Asia would be partnerships with device manufacturers and operators and their proven track records.

Kai Sahala, Head of Asia Pacific and Japan 5G Sales at Nokia, said that 5G spectrum availability in Asia delays development outside major markets in Japan, South Korea and China, but his company is seeing opportunities in Vietnam, Malaya, the Philippines, Indonesia, Thailand and Singapore.

We compete in many markets with all sellers, including Huawei and we were successful,” he said.

“It tells us something is in our position, and especially our 5G offering.” Sahala says the firm takes a number of market approaches for countries in Asia.

“I don’t think that these things are negotiated only for price,[ but also] quality, reliability, openness, security and platforms,” he said.

He admits that there have been obstacles to the development of the 5G network in South Korea such as the initial spot performance and delays.

“It’s about long-term performance in the big picture,” he said. “Performance is really outstanding through independent studiesour 4G networks.”

Some view the recent United States restrictions on Huawei, which prevent US companies from working with or supplying the Huawei components, as a competitive factor.

Multiple sources indicated that the restrictions have forced Huawei to “slow” some projects, such as those in its server business. In the first quarter of 2019, one said Huawei had ordered a large number of components, giving it a temporary buffer from US supply chain problems.

But Steve Cheng, Vice President and CEO of Taiwan’s Quanta Computer said Cybersguards low cost is difficult, and he thinks that U.S. restrictions will give other players a better chance of developing the 5G market.

Sahala said that Nokia has a “neutral” position on the restrictions, as the governments decide, but continues to keep an eye on the developments. Meanwhile Kruse and Ericsson’s spokesperson refused to comment on the Huawei restrictions.

Finally, is Huawei going to come out as a front runner?

Caroline Chan, vice-president of the Data Center Group and manager of 5G infrastructure at Intel, told Cybersguards that the US company would respect the US government order of Huawei–a “tricky situation,” but said there is no clear 5G leader in Asia yet.

“Everyone realizes there is an enormous potential to get there,” she said. “The question is how aggressive and courageous you are.”

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