Internet provider TPG has stopped the rollout of its mobile network due to the government’s ban on Huawei equipment for 5G networks. TPG’s plan is to eventually upgrade their mobile network to 5G in the near future. The ban from the government means that the network would be prevented from ever being upgraded.
The company has been rolling out a small-cell network in major metropolitan areas using Huawei equipment. So far the spend on the new equipment has been $100 million on the rollout and implementation of 900 small cells out of a total of 1500 sites.
The long term vision for the cell network was to upgrade it to 5G, also using Huawei equipment, and with the government’s ban in August last year, that path has now been blocked.
According to ITNews, the company said in a financial filing, “The company has been exploring if there are any solutions available to address the problem created by the Huawei ban but has reached the conclusion that it does not make commercial sense to invest further shareholder funds (beyond that which is already committed) in a network that cannot be upgraded to 5G”.
The decision to stop creating the mobile network means that TPG owns a 4G spectrum it can’t use. It is also the joint owner of the future 5G spectrum worth $263 million, which it bought with Vodafone at a recent auction.
“The Board is not in a position at this time to announce any decision on its future strategy for TPG’s current spectrum holdings,” the company said.
“It will consider carefully all the options available and will update the market once a decision is made”.
TPG’s executive chairman David Teoh said it was “extremely disappointing” to have to pull the pin on the rollout and the company’s 5G ambitions, which he said had been “undone by factors outside TPG’s control”.
It will be interesting to see how the rollout of 5G in Australia will be affected by the loss of Huawei as a supplier. Watch this space.