Australia's TPG Telecom dumps Huawei-supplied mobile network

January 29, 2019 09:23
TPG Telecom has so far spent A$100 million (US$72 million) on the rollout of the Huawei-supplied mobile telephone network, but it said it does not expect the cancellation to affect its 2019 guidance. Photo: AFP

Australia’s TPG Telecom Ltd. canceled the rollout of its mobile telephone network because it relied on Huawei Technologies Co. Ltd. equipment that has been banned by Australia’s government on security grounds, Reuters reports.

The nascent cut-price network is the first commercial casualty in Australia of the ban announced last August and comes as Western powers crack down on the Chinese telecoms giant over concerns at its links with China’s government.

The world’s biggest telecoms equipment maker has been under siege since the arrest of its chief financial officer, Meng Wanzhou, in Canada last December. The US Justice Department on Monday accused the company of bank fraud and conspiring to steal trade secrets from T-Mobile US Inc.

TPG said in a statement on Monday that it chose Huawei as a supplier because it offered a simple upgrade path to 5G technology.

“In light of the government’s announcement in late August 2018 that it would prohibit the use of Huawei equipment in 5G networks, that upgrade path has now been blocked,” the statement said.

The company has spent A$100 million (US$72 million) on the rollout so far, but said it did not expect the decision to affect its 2019 guidance.

Huawei is facing pressure globally after the United States and Australia initiated measures to restrict the Chinese firm and its compatriot ZTE Corp., citing security threats.

Australia’s intelligence agencies feared that if mobile operators use Huawei’s equipment, the company could develop a means of collecting data at Beijing’s request – something the company strenuously denies.

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