July 30, 2020 / 9:02 AM / 7 days ago

Orange signals possible reduction of Huawei mobile gear in Poland, Belgium

PARIS (Reuters) - French telecoms operator Orange (ORAN.PA) may cut its use of Huawei’s mobile gear in Poland and Belgium amid mounting U.S. pressure to purge 5G equipment made by the Chinese giant in the region, Chief Executive Stéphane Richard said on Thursday.

The logo of French telecoms operator Orange is pictured on a closed retail store in Paris, France, April 17, 2020. REUTERS/Charles Platiau/Files

European countries are in the middle of a growing geopolitical storm between the United States and China, with heavy industrial and financial consequences for telecoms operators on the continent.

The United States say Huawei’s equipment could be used by the Chinese government for espionage - a charge denied by Huawei and Beijing - and has pressed its allies to ban it.

Britain has ordered the Chinese company’s equipment to be purged from its 5G network by 2027. Sources told Reuters last week that France would de facto follow suite.

“There’s part of the 5G network that we’ll do with Huawei in Spain,” Richard told reporters during a news conference. “In other countries (where we operate), such as Belgium and Poland, no final decision has yet been taken.”

“But it’s obvious that we’ll have to take into account the general political and geopolitical context that we see in Europe,” he added. “Indeed, it’s likely that, in time, the share of Huawei equipment in Europe will decrease.”

Orange, which is controlled by the French state, does not have Huawei-made mobile equipment in the country. It is one of the least exposed European telecoms operator to the Chinese company, Richard said.

Asked whether current pressure on Huawei could impact an existing 3-year-old partnership between Orange and the Chinese company in cloud computing services, Richard said it may not be as “relevant” today as it used to be.

“It’s clear that this Huawei cloud infrastructure isn’t necessarily the one we will be promoting in Europe today,” Richard said.

However, he added that Orange’s business offers made with Huawei could still appeal to customers outside Europe, notably in Asia, where its division Orange Business Services also operates.

The comments come two days after Orange announced a far-reaching strategic partnership with Alphabet’s Google (GOOGL.O) covering data, artificial intelligence (AI) and cloud computing services.

Reporting by Mathieu Rosemain; Editing by Geert De Clercq and Emelia Sithole-Matarise

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