Long-term Huawei customer 2degrees is now partnering with Ericsson to build its new 5G network.
2degrees said today its first 5G sites will be built in Auckland and Wellington this year and the network would expand to the other main centres, with plans for 700 sites.
2degrees is the only telco in New Zealand to use Ericsson’s technology, with Nokia and Samsung also servicing local telcos.
In addition to enabling the 5G network, including its radio access network (RAN), the partnership with Ericsson will also allow 2degrees to double its 4G capacity.
The deal could be transformational for Ericsson in New Zealand as it has consistently failed to win major network contracts over the years.
Ericsson NZ reported around $16 million in revenue in each of its past two financial years, for instance, compared with Huawei and Nokia, which were both pushing towards $200 million.
China-based Huawei's mobile equipment business has been hobbled among members of the Five Eyes security partnership (the US, Canada, Australia, New Zealand and the UK) by security concerns.
2degrees' chief executive Mark Aue described the partnership as another major step forward for the company.
“Ericsson is rapidly expanding its New Zealand presence and we look forward to bringing our customers the technology that is underpinning the world’s best 5G networks across five continents, including Australia’s leading mobile network,” Aue said.
Aue said Ericsson’s global pedigree was highlighted recently by research company Gartner, which awarded it top ratings for its ability to execute on 5G.
“Our launch will be well-timed and what we’re building today will be far more advanced than what any telco could deliver a year ago,” he said.
“In the past 18 months there have been significant advances in the 5G ecosystem and our 5G build is poised to capitalise on that -- ultimately 2degrees customers will benefit from mature and proven technology.”
Emilio Romeo, head of Ericsson Australia and New Zealand, said the company was delighted to be chosen as 2degrees' 5G RAN and core provider partner.
“We’ve come to know 2degrees, its team and its ambitions well in the process leading up to today’s announcement,” Romeo said.
“It’s exciting to work with a challenger brand and a telco that is growing its market share at pace. We’re excited to see the role 5G will play when our technology goes live later this year.”
Romeo said Ericsson was investing in New Zealand and had both local capability and global experts deploying infrastructure with 2degrees.
Aue said Ericsson was appointed following a multi-vendor selection process.
“We started replacing the core of our network in 2020 and now we can accelerate the build out of 5G with our planned upgrade of existing sites,” Aue said.
“The move to 5G is a natural evolution for 2degrees and, like the move to 3G and then 4G, will be funded by the company’s established capital investment plan.”