Chinese network equipment manufacturer Huawei Technologies is increasing its investment in Ontario in hopes that will persuade enterprises to buy its switches and routers.
The company said on the weekend it is committing $210 million in new investment to create 325 new jobs over the next five years. When combined with existing research, development and operational plans, Huawei’s total investment in Ontario over the next five years will be $500 million.
“We hope that this type of commitment to our operations reinforces that we’re here to stay in Canada,” Scott Bradley, Huawei Canada’s vice-president of corporate and government affairs, said in an interview today.
“We’ve had a tremendous over the last six years in Ontario, both from a business perspective of building up a strong base of tier 1 and tier 2 operators in Canada, and we’ve had tremendous success with the R&D centre in Kanata. From that we’ve built confidence with headquarters, and as we continue to expand research globally in advanced areas like 5G, the Canada Research Centre is already playing a key role in a lot of that work. As a result as we look at future projections it makes sense to continue to build the team here.”
Some 550 people currently work at the R&D centre just outside Ottawa and at Canadian headquarters in Markham, Ont. About 250 of the new hires will be engineers and researchers, while at least 75 will be sales marking and support staff.
“This investment will create a significant number of jobs and reinforces Ontario’s position as a global leader in ICT and telecommunications,” premier Kathleen Wynne said in a statement from Bejing, where she is on a trade mission that included a visit to Huawei’s R&D centre there. “My government is fostering a dynamic business climate to attract even more investments from Huawei and other leading companies around the world.”
“Today’s announcement reinforces Huawei’s commitment to Canada and to the province of Ontario,” Huawei Canada president Sean Yang said in a statement. “Canada and Ontario have a legacy of leadership in ICT and telecommunications. Since 2010, Huawei’s Canada Research Centre has established itself as one of the global leaders in advanced communications technologies, including 5G. The success of this facility has reinforced to Huawei the value of Ontario’s talented workforce, and network of universities in Ontario and across Canada, that can support innovative research.”
Huawei opened its Canadian office in 2008, around the time BCI Inc.’s Bell Canada and Telus began buying switches for their wireless networks. Later it sold equipment to Wind Mobile and SaskTel.
However, Huawei has also had to face allegations from a U.S. Congressional committee that its products are being used by the Chinese government to spy on other countries. The Globe and Mail has said one of the reasons the Harper government refused to allow Wind’s shareholder VimpleCom Ltd. permission to take over the company was because of Huawei’s equipment is in the carrier’s core. VimpelCom’s biggest shareholder is Russian magnate Mikhail Fridman.
Former Nortel Networks security advisor Brian Shields has also alleged that Huawei might have been a beneficiary of technology stolen from Nortel before it went bankrupt.
However, Bradley said there hasn’t been an impact from customers. “The landscape is so different than it was two years ago. We’ve worked openly and transparently with our customers for six years in Canada. There has never been a (security) issue. We are doing everything we can to ensure there never will be an issue. And I think the reason we’ve had success in Canada is we make very innovative products and we’re competitive in the marketplace.”
“We certainly feel we’re doing the things that people want to see from us to be confident in saying, ‘Here’s a company I want to be with,’ and that’s particularly related to making an investment in Canada.”
While Huawei sell enterprise switches here, the bulk of its sales are still telecom carrier related, Bradley said.
Meanwhile today Huawei said SaskTel will bring cellular service for the first time to remote communities in the centre of the province using some of its equipment. It’s a partnership between Huawei, SaskTel and the Athabasca Basin Development agency. Service will come to Wollaston Lake, Stony Rapids, Fond du Lac First Nation and Black Lake First Nation next year.
It will cost $5.8 million to extend the cellular network to the communities. Of that the agency is providing $249,000 and Huawei $385,000. Its part of a SaskTel program where local communities are encouraged to raise funds to cover a shortfall when SaskTel deems it not economically feasible to build a new cell site. Huawei has added monies to make up the difference.
Huawei is also working with a number of Canadian Universities on 5G related research projects.