Huawei's Nordic Coup

1:45 PM -- If anyone had any doubt that the telecom infrastructure world has changed during the past five years, they might consider today's news from Telenor Group (Nasdaq: TELN) that it's going to replace its entire mobile infrastructure in Norway with radio access equipment from Huawei Technologies Co. Ltd. and next-generation packet core equipment from Starent Networks Corp. (Nasdaq: STAR). (See Telenor to Replace Mobile Network and Telenor Picks Starent.)

The move is part of Telenor's migration to LTE and is the type of deal that, in the past, would have been snapped up by the likes of Ericsson AB (Nasdaq: ERIC) or Nokia Networks , but not any more. Now those traditional vendors are being replaced -- they're the incumbent suppliers at the Norwegian incumbent.

Telenor notes that a number of vendors were considered for the multiyear $175 million deal, and that "all the providers were evenly matched, but in the end Huawei and Starent Networks, which is being acquired by Cisco Systems Inc. (Nasdaq: CSCO), emerged as the winners. It was a combination of technical quality, reliability in terms of handling a large-scale equipment replacement operation and commercial terms that was the deciding factor." (See Cisco to Buy Starent for $2.9B.)

Cue the usual comments (no doubt) that it was likely that, at least in Huawei's case, "commercial terms" would have been paramount.

Telenor's decision is noteworthy for more than just its choice of vendor partners, as it shows that an experienced carrier believes it's more efficient to build a new network using new suppliers than adding to and upgrading its existing mobile infrastructure to move to LTE. Telenor notes that the "replacement of infrastructure will represent a moderate increase in investments over the next two years, and thereafter improve our cost and capex structure."

— Ray Le Maistre, International News Editor, Light Reading

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