Danish telecom provider TDC has sidestepped China-based vendor Huawei in favor of Sweden-based Ericsson to build the company’s 5G network. TDC has had a long-standing relationship with Huawei, which has increasingly come under a microscope due to security concerns.
The new agreement will see Ericsson supply equipment and services for the network that is scheduled to be available across Denmark by the end of 2020. The TDC deal also restores a customer that Ericsson lost to Huawei in 2014. At the time, TDC signed a six-year LTE deal with Huawei in a move that was widely regarded as a big domestic loss for the Swedish vendor.
For Ericsson, the contract win boosts its 5G presence in the Nordic region. The vendor has already been selected by Telenor Group to implement cloud core solutions to support 5G in Denmark, Norway, and Sweden. And it’s teaming up with Telia and Volvo in Sweden on the operation of a 5G network for industrial use.
Ericsson has now announced 15 5G deals with operators and 43 5G operator agreements. This latest contract with TDC could be a further sign that Ericsson and fellow Nordic-based vendor Nokia are starting to benefit from Huawei’s woes. Highlighting that notion is that Ericsson will also take on responsibility for maintaining and expanding TDC’s LTE network, even though the contract with Huawei was originally due to run until 2020.
‘Not Blind’ to Concerns
TDC CEO Allison Kirby told local media that the operator “is not blind” to the widely held concerns linked to Huawei and cybersecurity threats, although she also pointed out that price was a significant factor.
As is the case in many other countries, Huawei has become a hot potato in Denmark in relation to the construction of future 5G networks. The Danish Defense Intelligence Service and Minister of Defense Claus Hjort Frederiksen have both warned against Huawei in recent months, although it’s not clear how much pressure was placed on TDC to change vendor.
Financial details of the new agreement between Ericsson and TDC were not disclosed, although the previous deal with Huawei was worth $609 million over six years.
The contract is fairly broad as it includes both the 4G and 5G networks and will make use of Ericsson radio access network (RAN) and core network equipment, including Ericsson “cloud core” solutions. The companies have also signed a five-year managed services contract based on the Ericsson Operations Engine – an artificial intelligence (AI)-based managed services offering for carriers – that will see Ericsson operate TDC’s network beginning in September.
The implementation of Ericsson 5G New Radio (NR) hardware and software products is expected to start this year, with trials scheduled to begin by mid-year. The actual roll out of the 5G network is due to start in October, although this will depend on the availability of licensed 5G spectrum.
It’s currently not clear when Denmark will hold its 5G spectrum auction. It was scheduled to begin last September, but was postponed until further notice.
In February 2019, the government launched the 5G Action Plan for Denmark with four strategic pillars: frequencies, deployment, regulation, and application. In addition to spectrum plans, the framework is focused on the possibility of sharing networks, establishing dedicated local networks, and potential barriers to 5G.