Telecom Equipment News
- Western vendors undercut Huawei
Date: 22-Jun-2007 Sources: (Shenzhen Daily)
HUAWEI Technologies Co., China's leading communications network equipment maker, said Wednesday it should not be blamed for driving down prices in the global telecom network equipment market.
Unlisted Huawei is seen by larger rivals as one of the most aggressive vendors, offering its technology at up to half the price of its Western competitors, but a senior official from Shenzhen-based Huawei said larger firms had been undercutting it.
'Some Western vendors are providing much more aggressive prices than Huawei,'Jeff Liu, vice president at Huawei, told reporters on the sidelines of the CommunicAsia telecom fair in Singapore.
Liu declined to name which companies were driving down prices.
'This shows clearly how bloody the competition among the equipment makers is,'said Ben Wood, a consultant at CCS Insight in London.
Leading mobile telecom network vendors like Ericsson, Nokia Siemens Networks and Alcatel-Lucent have been suffering in the last few years as increasing price competition from Asia has hit prices.
At the same time, falling call costs have increased pressure on telecom operators to cut capital expenditure further.
'I think Ericsson is aggressively using pricing as a weapon to gain market share, which makes sense, with other players having to use some energy in reorganizing,'said analyst Karri Rinta from Handelsbanken in Helsinki.
Alcatel-Lucent was formed last year, while the Nokia Siemens joint venture started its operations less than three months ago.
Huawei said in May it expected a 36 percent rise in contracted global sales this year after a 34 percent increase in 2006.
Huawei, which generated 65 percent of its turnover overseas last year, expects to book US$15 billion in overall contracted sales in 2007, up from US$11 billion a year earlier, its senior vice president, Li Jinge, said.
In August, Huawei secured a deal to sell third-generation telecom equipment to U.S. wireless carrier Leap Wireless, its first 3G sale in North America.
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