Turkcell Leaps to Huawei's Defense

Iain Morris
2/6/2019
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Turkcell has become the latest operator to speak out in support of Huawei as governments in Europe and other regions consider banning it from equipment markets because of security concerns about its technology.

Kaan Terzioglu, the Turkish operator's CEO, said there were no plans to replace Huawei, dismissing recent claims about the security of its products as "uncorroborated."

In an unprompted statement, he also suggested the campaign against the Chinese equipment vendor -- today the world's biggest supplier to the international telco market -- was motivated by competition concerns in the fast-developing 5G market.

"It wouldn't be right to evaluate Huawei's current situation by ignoring the competition in the smartphone market and the conflict of which company will lead 5G," said the Turkcell Iletisim Hizmetleri A.S. (NYSE: TKC) CEO. "No one should expect us to act on uncorroborated claims. Turkcell will continue to work with its long-time business partner Huawei."

Several governments have now moved to exclude Huawei Technologies Co. Ltd. from their telecom equipment markets out of apparent fear that its products may include spyware used by Chinese authorities. Australia and New Zealand have taken steps to banish Huawei from the 5G sector, while the US and Japan have forbidden service providers with government contracts from working with Chinese vendors. Taiwan also has restrictions in place. (See Huawei's Ills Don't Guarantee Good Times for Ericsson, Nokia, How the West Can Hurt Huawei and Where Huawei Fears to Tread.)

With European authorities said to be weighing moves against Huawei, some of the region's former state-owned telecom monopolies have indicated they will not use the Chinese vendor in some parts of the network. (See Eurobites: EU Must Act as One on Huawei, Says French Minister.)

The UK's BT Group plc (NYSE: BT; London: BTA) has told Light Reading it is stripping Huawei gear out of its mobile core and optical networks, and that Huawei will not be considered as a provider of core 5G or mobile edge computing equipment. Meanwhile, France's Orange (NYSE: FTE) has said it will not deploy any 5G equipment from Huawei in its domestic market. (See Huawei Cut Out of BT's Mobile Core, Optical & Edge Plans and Orange Rules Out Huawei for 5G in France.)

But various other service providers have now spoken out in support of Huawei.

Telecom Italia (TIM) promised in December to continue its business relationship with Huawei unless there were government restrictions. At the time, a spokesperson told Light Reading, it had not received any indications from the Italian government on how to manage relationships with suppliers. (See Telecom Italia Stands by Huawei as Peers Waver.)

While Vodafone Group plc (NYSE: VOD) has "paused" its deployment of Huawei's core network equipment in Spain and smaller European markets, CEO Nick Read told CNBC the security debate had become too "simplistic" and that he would speak with security agencies and politicians in a bid to improve understanding. (See Huawei Controversy Pits Spooks Against CSPs.)

He also said that any complete ban on Huawei in the radio network would be a "huge issue for the whole European telco sector," pointing to the major role the Chinese now plays in European mobile networks.


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Germany's Deutsche Telekom AG (NYSE: DT) looks similarly intent on fighting efforts to ban Huawei. In an internal assessment seen by Bloomberg, the German telecom incumbent, which has already started deploying Huawei's 5G antennas, is said to have warned that excluding Huawei could delay 5G rollout by two years and lead to a spike in costs. (See Huawei Hits Out at DoJ Amid Global Backlash.)

Even though it is stripping Huawei gear out of its core networks, BT seems likely to be similarly resistant to any wholesale ban. Neil McRae, BT's chief architect, described Huawei as "the only true 5G supplier right now" during a conference in November. (See BT's McRae: Huawei Is 'the Only True 5G Supplier Right Now'.)

Turkcell appears to have relied heavily on Huawei for the deployment of a 4G network and last month said it had "verified" a new 5G basestation from the Chinese supplier on a commercial network in Turkey.

A memorandum of understanding it has just signed with Huawei covers the rollout of a "basic" 5G-oriented network, among other things.

Terzioglu said in today's statement there were "potential risks" with any deal, pointing out that many "Western companies" had experienced failures when it came to securing data. "We have been and always will be very cautious about our business partnerships," he said.

— Iain Morris, International Editor, Light Reading

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