A pair of European companies with major R&D operations in Kanata have landed contracts with two of the country's three largest telecom companies to supply 5G networking equipment.
Bell Canada announced Tuesday morning that Sweden-based Ericsson will be its second supplier of the radio access network equipment that has been Huawei's main product line in Canada since entering the market in 2008.
Later in the day, Telus Corp. announced that it had also selected Ericsson, as well as Nokia of Finland, as suppliers for its 5G networks.
Neither Bell nor Telus provided details on how much their contracts with Ericsson and Nokia were worth.
Both European companies have been ramping up their hiring in Kanata ahead of the rollout of 5G. Nokia announced in 2019 that it would be adding 237 new jobs in Canada, the vast majority of which would be in Ottawa. Ericsson, meanwhile, added 200 net new employees in 2018-19, according to OBJ’s Book of Lists research.
Blow to Huawei
Tuesday’s contracts are seen by some to be a major hit to the ambitions of another major multinational firm with a significant presence in Kanata – Huawei Technologies – to be a player in Canada's 5G network.
Huawei's participation in the construction of Canada's 5G network has become a major sticking point between federal officials in this country and their counterparts south of the border. The U.S. has warned Canada, the United Kingdom and other allies that it will limit intelligence sharing with countries that have Huawei equipment in their 5G networks – citing the potential for spying by China, an allegation Huawei denies.
“Huawei has worked closely with Bell in Canada for many years, helping them build one of the world's leading 4G LTE networks,” Huawei Canada spokesman Alykhan Velshi said in a statement.
He added that Huawei remains committed to Canada and looks forward to the federal government completing its 5G review and its decision about Huawei's role in Canada.
“We continue investing more than a quarter of a billion dollars a year in R&D in Canada. We continue building new research partnerships with Canada's world-class universities. As we have for more than a decade, we continue to work with our Canadian telecom partners to help them build and support state-of-the-art networks that connect Canadians,” Velshi said.
Bell said Ericsson will also support its rollout of 5G-enhanced fixed wireless home internet service to rural areas, which generally have less access to land-based fibre optics networks.
“We are proud to have earned Bell's trust to be selected as one of their key partners and significantly expand our existing relationship to accelerate the transformation of their network with 5G mobile and fixed wireless technology,” said Niklas Heuveldop, president and head of Ericsson North America.
The arrest of Huawei Technologies chief financial officer Meng Wanzhou in Vancouver in December 2018 sparked a major rift between China and Canada. The federal government has been undecided about whether the Chinese company will be allowed in Canada's 5G networks, which are currently being assembled.
Analysts have said Bell and Telus use Huawei extensively in their fourth-generation networks and would be more affected by a Huawei ban than their rival Rogers Communications, which has predominantly used Ericsson network gear.
Besides Huawei, Ericsson and Nokia, there are other companies that want a piece of the 5G network upgrades.
Samsung Electronics has announced a deal to supply equipment for Videotron's wireless network in the province of Quebec and in the Ottawa region.