Through long time hard efforts in the overseas 3G markets, Huawei is welcoming a climax of reaping. During the past over one month, Huawei announced in succession the agreements on 3G equipment supply to Spain Vodafone, Japan eMobile, and U.S.A. CDMA operator Leap. With these agreements, Huawei has realized overall breakthroughs in the three developed 3G equipment markets of North America, Japan, and Europe.
In Europe, the cradle of WCDMA, the globally largest mobile operator Vodafone Group ("Vodafone") selected Huawei to deploy its commercial WCDMA/HSDPA network in Spain which is the prime and most significant sub-network of the Group; in Pakistan, where the number of mobile subscribers grows fastest, Huawei has won a USD 550 million GSM contract to expand the wireless network of Ufone, a subsidiary of Etisalat, and also Pakistan's second largest telecom service provider.
With high quality, excellent performance and high reliability, Huawei's wireless products and solutions fully satisfy the stringent requirements of operators from high-end markets and are getting more and more recognition in the global context.
In August 2006, Telefónica, one of the top 10 telecom operators in the world, announced in Sao Paulo, Brazil that it had selected Huawei as the prime supplier for Vivo, the largest mobile telecommunications operator in the South Hemisphere, to construct a 3G-oriented GSM network. This signifies that the strategic cooperation between Telefónica and Huawei is enhanced to a new phase.
The Telefónica Vivo GSM project entails construction of the largest GSM network for 2006 in Latin America. According to the contract, Huawei will construct GSM networks for the most developed states along the coastline of Brazil, including Rio de Janeiro, Espírito Santo, Paraná, Rio Grande do Sul and Santa Catarina, which cover world-famous tourism cities such as Rio de Janeiro. As specified in the contract, hundreds of Huawei EnerG GSM BTSs (Base Transceiver Stations) will be deployed in the first phase of the project, and around 3,000 EnerG GSM BTSs will be deployed upon the completion, signifying the widest-scale application of Huawei EnerG GSM solutions.
Vivo, a joint venture between Telefónica Móviles and Portugal Telecom, is the third largest CDMA operator worldwide and is a leader in the retail market and the corporate segment, serving up to 30 million customers.
Then as a successful CDMA operator, why did Vivo decide to convert CDMA networks to GSM networks? And why did Vivo choose Huawei from so many world-leading GSM equipment suppliers?
Challenges and Opportunities Vivo Faced
As a world-leading telecom operator from Europe, Telefónica brought advanced management experience and strict access standards to Vivo. In front of the challenges in the CDMA networks, it is urgent for Vivo to transform its CDMA-based mobile services.
The data from Anatel, a Brazilian telecom management organization, states that, to July 2006, the market share of GSM services in Brazil reached 59.3%, up 14.4% from last year, while the share of CDMA services decreased from 28.9% to 26.3%. As the only CDMA operator in Brazil, Vivo still ranks NO.1, but its market share has decreased by 7% from July 2005 to July 2006.
Upon comprehensive discussion, the board of Vivo finally decided to replace CDMA networks with GSM networks. When choosing the supplier for the GSM network, Vivo was extremely careful. That's because the new GSM network deployment not only requires billions of dollars investment but also indicates a significant strategy transformation.
In July 2006, all the main worldwide GSM equipment suppliers, as invited by Vivo in June, presented the public bidding.
After strict initial examination, eight of the suppliers entered the short list. In the three rounds of detailed review and appraisal followed, three of the eight suppliers were eliminated after the first round of appraisal which focused on technology and products. Thus, a total of five suppliers entered the following two rounds of appraisal which highlights excellent business and delivery. With sufficient preparation before the bidding, Huawei submitted its delivery solutions, which satisfied Vivo much. In addition, Huawei's well-proven network deployment capabilities and professional services provided in Latin America have also ensured fast and excellent delivery of end-to-end solutions. All these gave much confidence to Vivo. In consideration of immense difficulties in realizing fast delivery, Huawei seeked local coadjutant resources to work out a reliable local delivery plan, including consignment and project construction. To complete the project as scheduled, Huawei promised that it would provide no less than 300 engineers during peak hours.
The fact that Huawei has 11,283 certified coadjutant GSM BSS engineers and 295 GSM BSS experts can well ensure the provision of large-capacity networks and professional services. Meanwhile, after training 5,632 internationally certified project management professionals, Huawei obtains useful methods and rules regarding network project, which also weighs much to Vivo.
To Vivo, this turnkey project involves not only purchasing and deployment but also the high capacity and quality to provide perfect experience for end users. "We chose not only a supplier but also a future-oriented strategic partner," said Mr. Cesar Alierta, Chairman of Telefónica group.
Boasting of its creative 3G solutions, excellent local services, advanced technology, and rich project experience, Huawei was selected by Vivo as its strategic partner for the future-oriented GSM network.
Step by Step, Huawei Established Itself in Brazil
With a population of 167 million, Brazil is the fifth largest country in the world and also the most affluent country in Latin America. No wonder Bill Clinton, a former president of the USA, once said, "God must be Brazilian!"
In recent years, the mobile communication market of Brazil grows rapidly, with an annual increase of 35%. As of July 2006, Brazil has become the world's fifth largest telecom market, with a mobile subscriber base of more than 93 billion. "To enter the Latin American telecommunication market, entry to the Brazilian telecommunications market is a must," a telecom insider often comments.
With the opening -up of the Brazilian telecom market, many multinational carriers entered the market, further intensifying the fierce competition. Naturally, it is very hard to grab any market share in Brazil, and even a well-known supplier had to withdraw from the market after trying for 30 years.
Early in 1999, Huawei set up a branch office in Brazil. At first, it was difficult even to make an appointment with Brazilian operators. It took Huawei tremendous hard efforts to open the new market. Seven years later, Huawei has become a main supplier in Brazil.
During the past years, Huawei has been always keen to listen to the subscribers. Zhang Pingan, Vice Present of Huawei Latin America, recalled that, "After five years of hard efforts, that is, in 2004, Huawei Wireless was awarded the first commercial contract in Brazil, which was from CTBC, a major Brazilian telecommunications operator."
In September 2004, Brazilian CTBC selected Huawei to build a new generation mobile network. The turnkey solution provided by Huawei covers the entire network, from Mobile Infrastructure (GSM/GPRS/EDGE/UMTS), Data Bearer (Core Router), Optical Network (SDH and DWDM), Broadband Access (DSLAM), to unified value-added service platform, as well as 3G solutions.
The delivery and installation of the equipments were fulfilled in the shortest possible time. In December 2004, three months later, Huawei helped CTBC to put its mobile network into commercial deployment in its concession areas including Sao Paulo, Minas Gerais, Goias. Besides abundant IN services, such as PPS (Pre-Paid Service), VPN (Virtual Private Network), FPH (Free Phone), Televoting, NP (Number Portability) Black&Whitelist , Huawei also provided value-added services platforms such as SMS (Short Message Service), MMS (Multimedia Message Service), PTT (Push to Talk), LBS (Location-Based Service), Streaming services, and more.
It is the first time that an all IP- and R4-based GSM softswitch network was put into commercial application in Latin America.
Brazilian senior telecom insiders commented that the fast delivery of the CTBC project helped to boost Brazilian operators' confidence in Huawei. When Huawei finished the network deployment within two months, many operators said it was mind-boggling to finish the perfect deployment in such a short time and telephoned to know more details.
Telemar/Oi, owned by Telemar Group, is the largest private enterprise group and a leading GSM mobile operator in Brazil. It is the first operator that deployed a GSM network, which covers 16 states across Brazil and serves more than 10 million subscribers. In March 2006, Telemar/Oi awarded Huawei a GSM network expansion contract. According to the contract, Huawei will help expand the GSM commercial network leveraging Huawei's comprehensive portfolio of GSM access network equipment, which includes BTSs, BSCs, and microwave transmission facilities.
From network expansion to deployment, Huawei finally won recognition in the fastidious Brazilian telecom market.
Integrative strength, like high quality products, E2E solutions, fast delivery and deployment, as well as rich experience in network construction, helped Huawei to stand out in Brazilian telecom market, and good public reputation in turn led Huawei to more rapid growth.
In 2001, Huawei's sales in Brazil were only $8 million. In four years time, the number rose to $2 billion in 2005.
Step by step, Huawei expanded its share in the Brazilian market and became a major supplier in Brazil. Now Huawei is serving almost all major Brazilian telecom operators including Telemar, Brasil Telecom, Telefónica, Embratel, CTBC, GVT, Vivo, and Telemig.
Innovative Solutions Help Huawei to Win Subscribers
With the rapid development of mobile telecommunications worldwide, the GSM subscriber base has exceeded 15 billion. Although the GSM market witnessed exponential growth, it still has much potential, because there are about 26 billion non-GSM subscribers in GSM areas and half of them are beyond GSM coverage.
While most global operators are busy constructing 3G networks, Vivo gave much consideration to network construction costs and 2G/3G evolution after the strategic transformation. Huawei provides future-oriented EnerG GSM solutions, which can help operators to maximize their value and profit by lowering network construction costs and the network life-cycle operational & maintenance expenditure. The R4-based softswitch CN supports simultaneous GSM BSS and UMTS RAN access; unified 2G/3G PS CN helps operators to secure their investment. In the CN domain, the upgraded HLR can support simultaneous management of GSM, GPRS, and UMTS subscribers and mutual application between 2G and 3G scenarios, which suits Vivo much.
"The Vivo GSM project is one of the largest mobile projects of Telefónica in recent years. For us, the compatibility with 3G services is very important for assuring the future upgrade to WCDMA/UMTS in a cost-effective way. Telefónica is very glad to further develop relationship with Huawei in Latin America," commented Mr. Cesar Alierta, Chairman of Telefónica.
To support heavy traffic in the densely populated inner cities such as Rio de Janeiro, the GSM Dual Density BTS of Huawei adopts dual density transceiver that features high capacity and small size. In addition, the transceiver also supports multiple intelligent RF technologies, through which the world-leading high sensitivity greatly enhances the network performance, and remote and real-time monitoring. It thus enables centralized management to reduce overall cost. To better serve unevenly populated areas, the GSM Dual Density BTS of Huawei adopts advanced technologies like AMR/ICC to provide better voice services while improving the network capacity.
In the five states covered by the project, Vivo holds a great number of high-end users. The enhanced eMLPP+HR solution of Huawei assigns channels in accordance with the priority predefined for users. The Huawei EnerG GSM solution can satisfy different application scenarios, as it takes into consideration of the capacity, coverage, civil works, transmission, service, and evolution of networks. The GSM Dual Density BTS of Huawei has powerful capacity to support myriad services, such as EDGE, HR, AMR, eMLPP, extended cell and many other services, so as to satisfy more diversified service requirements.
Fast Deployment of the Largest GSM Network in Latin America
Teleco, a professional consulting firm for Brazilian telecommunications, predicated that the mobile subscriber base in Brazil would exceed 1.3 billion and competition would be focused on such developed areas as Rio de Janeiro. These five states covered have an area of about 670,000 square kilometers and a population of 50 million. However, the complicated topography and unevenly distributed population- 30 million located in the five major cities and the rest 20 million in other areas, make it very difficult to plan and optimize the network.
It was a severe test on Huawei's delivery capability. Huawei successfully deployed thousands of BTSs in the shortest time under the complex conditions.
For the most massive application of Huawei's EnerG GSM solution, Huawei provided the best team, which was led by the vice president of Huawei and made up of professional engineering experts and experienced engineers. The staff of Huawei local branch made strenuous efforts to ensure the project implementation. A localized team that understands and focuses on our customers' market challenges and needs is an ideal partner for Vivo.
"Thanks for Telefónica and Vivo's trust in Huawei, and we are delighted to have become Telefónica's key partner in the wireless area." said Ms. Sun Yafang, Chairwoman of Huawei, adding that "As the world's leading multinational telecom operator, Telefónica is very strict in selecting suppliers in terms of comprehensive ability. Huawei's leading solutions and quick-response and quality services will help Vivo to maintain its leading position in the market, and will bring its customers with more novel services and more abundant experiences."
A Global Supplier of Wireless Equipments with the Fastest Growth
Huawei builds up the confidence of world's top-level operators through persistent investments and ceaseless innovation. To November 2006, the GSM sales of Huawei have doubled in three consecutive years, and the Huawei EnerG GSM solution is serving 160 million GSM subscribers in more than 80 countries. Additionally, with rich experience in large-scale networking and swapping in complex wireless environments, Huawei has deployed more than 800 thousand TRXs. Currently, Huawei Wireless products have entered 14 countries in occident, including Germany, France, Britain, Portugal, the Netherlands and America and so on. Moreover, Huawei has set up 8 regional departments, 55 representative offices and technical service centers, with sales and services around the world. Up to now, Huawei has won 35 commercial contracts and accumulated rich experience in planning and deploying 3G network. All these indicate that Huawei has grown into a world-leading wireless equipment supplier.
Huawei has become a global supplier of wireless equipments with the fastest growth, and we believe that Huawei's rise in international markets will be "one of the most undeniable forces to the market structure change of telecom equipment delivery in the next five years", according to Scott Clavenna, Chief Analyst of Heavy Reading.
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