Huawei Australia unaffected by China spy concerns

Concerns raised recently in the US about Huawei's alleged association with the Chinese Government and People's Liberation Army (PLA) have not resulted in the tech giant losing business in Australia, a spokesman for the company told CRN.

Huawei Australia this week reported a greater-than-expected increase in staff numbers to 700 from 300 at the end of last year. The majority were allocated to new contracts with Vodafone and Optus in the company’s core networking offering, which Huawei spokesman Jeremy Mitchell said made up 70 percent of Huawei’s business.

In August Huawei launched its enterprise division, bullishly projecting an increase in local sales from $10 million to $100 million over the next few years, which Mitchell said the company was on track to achieve. Huawei's first commercial customer for the enterprise division was recently named as AARNET.

As for government business, Mitchell brushed aside security concerns recently raised regarding the Chinese company’s alleged connections with the Chinese Government and People's Liberation Army (PLA), saying they have not affected the local team’s ability to gain public sector contracts in Australia.

A 2008 US Defence department to Congress report found "Huawei maintain close ties to the [Peoples Liberation Army] and collaborate on research and development".

And in February this year US congressmen scotched Huawei's $US2 million buy of US supercomputer equipment maker 3Leaf after they lobbied intensely to unravel the deal completed the previous May. The reversal prompted Huawei USA chairman Ken Hu to issue an open letter inviting US Government investigation of the company.

In Australia Huawei counts the New South Wales Government among its public sector customers, supplying routers for its ambulance service. It is in talks with the Western Australian Government about providing communications for regional mining communities.

“We’ve seen continued growth in government and I think our record speaks for itself,” Mitchell said. “You don’t get to the position Huawei has globally and locally without people trusting your products and your people.”

Queensland’s RailCorp is among Huawei's biggest commercial customers in Australia.

One customer Huawei doesn't yet have is NBN Co.

Huawei is hoping to be named a second supplier to the NBN alongside key contractor Alcatel Lucent where it would provide solutions to link various wireless technologies supporting the national rollout.

Huawei's selection as an NBN supplier would inevitably spark questions around national security, however, despite the company's vehement claims that it has no connections with the Chinese government and is 100 percent employee owned.

Lazy competitors

But while the national security questions are yet to catch up with Huawei in Australia, the company said it continues to take business away from its key competitors.

Mitchell said that Huawei was making gains against what he described as the company's "lazy" competitors, including Cisco.

“We believe we will be a threat over the coming year,” he said. “The CEO of Cisco [John Chambers] said at the recent [Cisco] annual conference he was scared of us and we hope that pans out.”

Huawei recently hired distributor Simms International as part of its efforts to increase its share of the Cisco-dominated enterprise space. This would see Huawei build on its existing relationships with local telcos such as Telstra, Optus and Vodafone Hutchison (VHA), all of which have partnered with the company on projects including the build and rollout of high-speed mobile networks.

Huawei's fast-growing enterprise division also services the SMB market and is comprised of IP network solutions, cloud computing, data centre, server and storage solutions, unified communications and collaboration (UC&C) solutions and industry integrated solutions. Mitchell said Huawei is now in a position to offer customers an alternative to a formerly ‘monopolised’ market.

“We provide a very good alternative,” Mitchell said. “We provide technology that is compatible with other units and that is cost effective, and I think that is what consumers want.”

Huawei Australia has reported increased interest in its telepresence solutions across verticals including mining, health, and academia. It said new contracts would be announced in the coming weeks.