Vodafone Takes 200 Million Euro Hit From Huawei 5G Curbs

British telecoms giant Vodafone said Wednesday that it would cost about 200 million euros ($221 million) over five years to remove Chinese group Huawei’s equipment from core 5G European activities.

“We have now decided, as a result of the EU (recommendations) and the UK government”s decision, to take out Huawei equipment from the core,” Vodafone CEO Nick Read said in a conference call on its third quarter.

“It will take around five years to implement at a cost of approximately 200 million euros,” he added, stressing that the cost would mostly apply to European activities outside of Britain.

Read added that Vodafone had a “very limited amount” of Huawei in its core European infrastructure — but warned it would take time to remove and swap equipment without disrupting customers.

The company had already decided last year to pause Huawei usage in core networks in Europe, he added.

Britain decided last week to exclude Huawei from core parts of the nation’s 5G network and also to cap its share of the market at 35 percent, insisting that “high risk vendors” would be excluded from “sensitive” activities.

London’s decision came shortly after Brussels said it also would allow Huawei only a limited 5G role in the European Union.

However US officials have said that the possibility of China using its commercial presence to spy on Britain — or even shut down the network — could force Washington to stop sharing intelligence with London.

“On 5G network security and supply chain resilience, I am pleased that the UK process was conducted on the basis of facts and evidence and informed by advice from the National Cyber Security Centre,” Read added on Wednesday.

“Vodafone UK is already largely compliant with these measures and so we have very limited financial exposure, following our decision last year to pause Huawei in the core of our networks in Europe.” The news comes after British peer BT said it would take a 500 million hit over the next five years after the UK government limited Huawei’s 5G role.―Outlook India