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Managed Services

Huawei Replaces AlcaLu at Sunrise

Huawei Technologies Co. Ltd. has struck a five-year managed services deal with Swiss operator Sunrise Communications AG , taking over a role previously held by Alcatel-Lucent (NYSE: ALU).

Huawei has been named as the sole managed services provider for sunrise's fixed and mobile networks. An unspecified number of staff will transfer to Huawei from sunrise and from the operator's "previous technology partner," which is AlcaLu.

Sunrise originally struck a seven-year managed services deal with AlcaLu in 2008, but, under new private equity ownership and with an aggressive broadband services strategy in place, the operator terminated that contract in August 2011, with the deal coming to an end in February this year. (See TDC Sells Swiss Sunrise for $3.2B and Euronews: Sun Sets on AlcaLu's Sunrise Deal .)

In April this year, sunrise announced a major fixed and mobile network modernization plan, with Huawei as its technology partner, and introduced a network quality program called TQ Net (Top Quality Network). From September, Huawei will operate and maintain the networks, with sunrise retaining strategic network planning and customer care responsibilities.

Sunrise has more than 2.1 million mobile customers, giving it a mobile market share of 24.1 percent, and 369,000 fixed broadband customers. The operator generated first-quarter revenues of 509.3 million Swiss francs (US$530 million).

Why this matters
Huawei may be having a tough time politically in Europe, but it's getting ever stronger as a partner to the region's operators and as a rival to the incumbent vendors -- AlcaLu, Ericsson AB (Nasdaq: ERIC) and Nokia Networks .

Those three European vendors have strong, experienced professional services businesses, but this deal shows that Huawei is making ground even in this sector.

The big question now is whether sunrise and Salt SA (Orange Switzerland) will finally merge and whether Huawei will also become the dominant equipment and services supplier at that operator too.

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— Ray Le Maistre, International Managing Editor, Light Reading

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