How do you handle Huawei / ZTE network equipment Softbank?(Page 1/3)

　In the procurement of 5G (5th generation mobile communication system) network equipment, mainly in the United States, there is a series of moves to virtually "exclude" Chinese manufacturers such as Huawei and ZTE.

On December 10th in Japan, the government implemented the ``Agreement on Procurement Policies and Procurement Procedures for National Goods or Services Related to IT Procurement'' (PDF format). On the 14th of the same month, the Ministry of Internal Affairs and Communications consulted with the Radio Regulatory Council "Guidelines for the establishment of specific base stations for the introduction of 5th generation mobile communication systems" (PDF format). We ask for your attention to this agreement.

　A number of reports have pointed out that these agreements and guidelines will lead major Japanese carriers to ``exclude Chinese manufacturers'' in 5G network equipment.

　Softbank is particularly noteworthy. The company uses Huawei and ZTE equipment in some base stations for 4G (4G LTE/AXGP), and has a particularly close relationship with Huawei in the introduction of "Massive MIMO" and 5G demonstration experiments.

　In the future, how will SoftBank interact with Chinese manufacturers?--At the listing press conference held on December 19, the company's Vice President Junichi Miyagawa (concurrently serving as CTO) and Senior Managing Director Kazuhiko Fujiwara (CFO) ) answered questions from reporters. This article introduces the main exchanges.

Waiting for government guidelines

――　Communications with a Chinese telecommunications equipment manufacturer I would like to ask about relationships. It has been reported that your company will no longer supply network equipment such as base stations for 5G as well as existing 4G (LTE) from Chinese manufacturers, including Huawei.

　Please tell us your current stance toward Chinese communication equipment manufacturers.

President Miyauchi: I would like to ascertain the government's guidelines regarding this matter.

　Together with (Vice President) Miyagawa, I have met with various government officials. (Depending on the government's policy) we naturally have risks, so we are always considering various alternatives.

　I think that the core part (of the network) will have to be changed to a European vendor, but unless there is a true report or guidelines, we should not move too quickly. I think.

Vice President Miyagawa: Currently, there are areas in the 4G network where Huawei and ZTE are in charge of base stations.

　(Softbank's 4G network) was originally developed only by European vendors, and (even now) it is basically configured mainly by European vendors.

Having introduced Huawei base stations for about eight years, I have the impression that (Huawei's) technology is extremely good. I would like to have a relationship with Huawei because it has technology and the price (of equipment) is cheap, but ultimately I would like to follow the policy of the Japanese government.

　When the guidelines come out, I would like to work in accordance with them.

―― So, does that mean that you haven't made a decision (whether or not to introduce equipment from a Chinese manufacturer) yet?

Vice President Miyagawa: That's right.

――　In relation to the previous question, did you answer with the current 4G in mind when answering the previous question about the base station?

Vice President Miyagawa 　Mr. Miyauchi's previous answer was about facilities on the core side (the core of the network), including 4G networks and fixed lines.

　We are currently consulting with government officials about this point, but there are not many devices (manufactured by Chinese manufacturers) that pose security problems (SoftBank's core devices). Is not ... As I said earlier, [the 4G network] is cored by European vendors.

Regarding the (core) composition, we would like to make a decision (as a company) after further discussion

Considering 6 vendors for 5G

――Recently, the Ministry of Internal Affairs and Communications announced 5G allocation guidelines (PDF format). Please let me know how you handle the equipment.

Vice President Miyagawa To be honest, I am aware that there are items that have never been seen before. For example, it includes conditions that have never been experienced before, such as "specify the name of the vendor (of the device)".

　I would like to firmly include (in the application form) that "I want to use this vendor for this equipment" and proceed to obtain (license).

――　There are some reports that (SoftBank) has decided on which vendor's equipment to introduce or not to introduce for 5G, what do you think?

Vice President Miyagawa　Since the allocation of 5G licenses is scheduled for the end of March 2019, the official answer at this time is that "no decision has been made yet".

　Currently, we have submitted RFPs (requests for proposals) to six vendors and asked them to provide final prices and specifications for 5G equipment, but which one to choose? I haven't decided yet.

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