VHA ditches Ericsson from $1bn bid

Vodafone Hutchison Australia (VHA) is believed to have ditched Swedish company Ericsson from its up to $1 billion dollar core network management bidding process.

Vodafone Hutchison Australia (VHA) is believed to have ditched Swedish company Ericsson from its up to $1 billion dollar core network management bidding process.

ZDNet.com.au understands that the vendor was informed two weeks ago of the decision which removed it from the three-company panel of bidders.

Its dismissal from the process would be a major loss for the company, which has provided the service for Hutchison for several years.

The bidding process, which began late last year, included Hutchison's incumbent network management service provider Ericsson, Vodafone's incumbent supplier Nokia Siemens Networks, and newcomer, Chinese heavyweight Huawei. VHA chief Nigel Dews revealed Huawei's inclusion at its half year earnings update.

Spokesperson for Ericsson Australia John Papanidis would not confirm that it had been dropped from the deal, deferring any queries to VHA.

VHA spokesperson Tyrone O'Neill said the company could not confirm whether Ericsson had been dropped until a contract for the deal had been signed, which it had not.

"I can't confirm. We're not planning to make any statements [about the contract] in the short term," he told ZDNet.com.au.

Yesterday O'Neill said that the winner would likely be announced within the next few weeks.

"We'll only be able to make a statement once the process is genuinely complete," he said today. "We need to approach it in a complete way."

Vodafone and Hutchison's 2009 decision to merge their operations and the merged entity's ambition to deliver $2 billion in synergies has seen it reassess the joint company's entire supply base.

The network management services contract centres on VHA's network operations centre, and would involve oversight of its operational and business support systems (OSS/BSS), which are used to monitor network faults and plan for capacity.

Typically companies such as Service Stream, Leighton company Vision Stream or Downer EDI would be sub-contracted by the prime contractor for network maintenance components.

It's unclear whether the 22 March resignation of Ericsson Australia's chief executive Jacqueline Hay was triggered by the company being dropped from the deal.

A spokesperson for Ericsson could not confirm whether her decision related to its position on the VHA bid.

Hay had been the director for Ericsson's Vodafone account in Australia prior to becoming its local chief. Ericsson's former Telstra account director Sam Saba has since taken over the Australian CEO role.

The company's revenues took a steep but predicted dive following the completion of its $1.4 billion deal with Telstra for its Next G build out. Ericsson pointed out at the time of Hay's departure that she had nursed the company to recovery throughout the financial crisis.