China seems to have decided not to even bother inviting foreign companies to bid on telecoms work anymore.

Scott Bicheno

October 5, 2021

2 Min Read
China Mobile didn’t even invite Ericsson and Nokia to its latest 5G tender

China seems to have decided not to even bother inviting foreign companies to bid on telecoms work anymore.

It’s hard to draw any other conclusion from the news that China Mobile only invited Huawei and ZTE to bid on the contract for its converged 4G/5G core, according to reports from Light Reading and Gizmochina. China Mobile itself doesn’t seem to have published anything and both stories seem to rely on a Chinese language report, so details may be lost in translation, such as the total sums involved.

But there seems to be unanimity on the matter of who was and wasn’t invited to bid. In fact, even the term ‘bid’ is obsolete these days as the Chinese state is clearly micromanaging the whole process and the façade of a competitive tender has been crumbling for some time. But such is the way of government interference in the market that they still feel compelled to pretend it isn’t taking place, however flagrant.

So, as ever, Huawei got most of the work and ZTE was brought in to turn a monopoly into a duopoly. The absence of any meaningful competition means the CCP will also need to keep a close eye on the subsequent work, as those involved have no commercial pressure to do a good job. On the other hand, Huawei and ZTE have a lot to be thankful for after US attempts to destroy them, so they’d be crazy not to put their best foot forward.

For Ericsson and Nokia this marks the culmination of what both of them seem to have been resigned to for some time. Another recent LR report revealed that Ericsson is already in the process of cutting hundreds of jobs in acknowledgment of its greatly diminished prospects in China. Nokia’s hopes, meanwhile, seem to rest on the Chinese state occasionally wanting to create the illusion of genuine global competition within its telecoms sector.

In a way this simplifies the whole situation: China is banning western vendors and the west is banning Chinese vendors. It’s a shame, but at least everyone knows where they stand. Stuck in the middle are multinational operator groups such as Orange, which revealed at a strategy presentation today that its Huawei policy continues to be guided by the specific rules of each country it operates in. Right now it’s hard to see any way back from the continued Balkanisation of the telecoms sector.

About the Author(s)

Scott Bicheno

As the Editorial Director of Telecoms.com, Scott oversees all editorial activity on the site and also manages the Telecoms.com Intelligence arm, which focuses on analysis and bespoke content.
Scott has been covering the mobile phone and broader technology industries for over ten years. Prior to Telecoms.com Scott was the primary smartphone specialist at industry analyst Strategy Analytics’. Before that Scott was a technology journalist, covering the PC and telecoms sectors from a business perspective.
Follow him @scottbicheno

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