Huawei says it has cut its Australian headcount by 100, with the Chinese telco equipment manufacturer blaming a government decision to bar it from participating in the roll out of 5G networks.
In a letter to the head of the Australian Mobile Telecommunications Association, Huawei Australia’s corporate affairs director, Jeremy Mitchell, wrote that if “the 5G ban continues on all Chinese companies we expect that number to grow to over 400 in the next 2 to 5 years.”
“These jobs are highly skilled, technology based jobs that unfortunately don’t seem to be being picked up by our competitors, again another major impact to the whole industry.”
The letter to AMTA chief executive Chris Althaus said that Huawei was resigning from the association. Mitchell said the company was disappointed that AMTA had not publicly highlighted the “real effects” of the government’s 5G decision.
In a statement AMTA said it regretted Huawei’s decision to resign.
“At no time has AMTA had any engagement with Government in the decision making processes related to Huawei’s situation,” AMTA said.
“AMTA will continue to work hard with members and on behalf of the mobile industry as a whole to promote the key role of mobile telecommunications in Australia’s economy and society – including the transformational role of 5G in Australia’s future.
“The Australian mobile sector can be proud of its leadership through the generations of mobile technology which will continue in the 5G era.”
Earlier this year Huawei Australia revealed that its carrier business had grown by 20 per cent thanks to strong investment from Optus and Vodafone in their 4G networks; however, a document outlining its annual financial performance warned that the 5G ban “may reduce the scale and growth of the company in subsequent years.”
Huawei has faced a concerted US-led effort to block its participation in the implementation of 5G networks, particularly among the nations of the ‘Five Eyes’ intelligence-sharing alliance.
Huawei revealed in August 2018 that the Australian government had informed it and ZTE that they would not be able to supply equipment for local telcos’ 5G rollouts, with the government citing national security concerns as the justification.
Although Huwaei had sought only to supply equipment for the radio access network (RAN) component of 5G networks, advice to the Australian government from intelligence agencies was that 5G will increasingly blur the separation between the edge and core of telcos’ mobile networks. Huawei has rejected that claim.
TPG cited the government’s Huawei 5G ban as the reason it decided to dump its rollout of a mobile network.
Vodafone Australia’s chief executive, Iñaki Berroeta, has argued that the decision has “significant long-term implications” for the local telco sector and risks further entrenching Telstra’s dominance of the local mobile market.