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November 09, 2020
Huawei Continues To Get Hammered Globally… What Is The Impact For The Telco Industry & 5G?

Huawei’s financials take a beating as President Trump’s sanctions come home to roost :

US sanctions are starting to have a pronounced impact on Huawei’s financials, with the embattled Chinese telco reporting just single digit year-on-year growth for the first three quarters of 2020.

Revenues to the end of September were 671.3 billion CNY (circa $100.4 billion, or £77 billion, at today’s exchange rates), up 9.9 per cent. This isn’t to be sniffed at but pales in comparison to the 24.4 per cent jump Huawei saw for the corresponding period of 2019.

Huawei becomes less transparent as growth slows :

Huawei is not a public company, so it’s not really obliged to publish any of its numbers, but it does so anyway, when it’s in the mood. This quarter it offered somewhat sparse fare, presumably because the numbers are going in the wrong direction. So we know it has banked CNY671.3 billion ($100 billion) so far this year and that its net profit margin over that period was 8%. That’s all you get this time, and be grateful for that.

Italy reportedly blocks Huawei 5G deal as Bulgaria joins US ‘clean network’ scheme :

Huawei’s steady stream of European setbacks continues with a report that the Italian government has vetoed a 5G deal between the Chinese vendor and Fastweb.

The scoop comes courtesy of Reuters, which says it has spoken to three anonymous sources on the matter. It reports the decision to veto the 5G core deal was made in a cabinet meeting late last week, on the pretext of Fastweb having an insufficiently diversified set of suppliers. Huawei and Fastweb have been working together on 5G for some time.

Nokia picked to swap out Huawei at Finland’s shared networks :

The telecoms kit maker Nokia is chosen by Finnish Shared Networks to deploy 5G RAN in Northern and Eastern Finland, as well as replacing the existing 2G, 3G, and 4G networks deployed by Huawei five years ago.

The deal also includes managed services for the Finnish Shared Networks (Suomen Yhteisverkko, or SYV in Finnish), jointly owned by Telia Finland and DNA (a subsidiary of Telenor). The contracted network covers half of the country’s land mass but only 15% of its population. Shared radio networks make more business and economic sense in areas with sparse population, due to the high cost related to radio coverage and low expected return.

Huawei Continues To Get Hammered Globally… What Is The Impact For The Telco Industry & 5G?

You’ll see below a link that takes you to a series of Huawei articles.

Long story short Huawei is suffering mightily.

In Network Infrastructure more countries continue to force Huawei out and are even mandating the ripping out of 4G infrastructure.

When an Operator is forced to invest in legacy (4G) infrastructure for any reason the unit economics are painful. It is especially painful when this upgrade/replacement is not as a result of increased traffic, but rather due to regulatory requirements.

It is the most expensive type of “infrastructure renewal”

On the handset side things also got worse for Huawei as well.

What is the impact for the industry?

Greater costs and less choice.

What is the impact for the consumer and B2B customer?

Acceleration of prices considerably higher than the rate of inflation.

Huawei Continues To Get Hammered Globally… What Is The Impact For The Telco Industry & 5G?