NSN has surprised the local vendors like Huawei and ZTE in recent China Mobile’s 4G contract bid, which is termed as world’s biggest telecom equipment contract. It has become the lowest bidder undercutting local vendors which used to enjoy up to 80% share of the contracts in past.
NSN’s bid of 33,000 yuan ($5,460) per single carrier was the lowest of nine vendors who took part, according to Chinese media reports. Huawei and ZTE both pitched 35,000 yuan. The move has surely surprised the super-confident Huawei camp, which has publicly predicted it would win the biggest share.
As mentioned in the article, according to the rules, China Mobile is bound to award tender to lowest bidder. But there are chances of a balancing act between Chinese and foreign suppliers under pressure for Chinese government.
China Mobile is bound by rules of the tender to award to the lowest bidder, yet must “balance between Chinese and foreign” suppliers, it said.
The tender is sure to be watched closely by EU officials for any obvious domestic ‘tilt’. The EU Trade Commissioner has launched a probe into alleged state subsidies for Huawei and ZTE exports to Europe.
In any case, NSN is certain to get much better share of the multi-billion dollar contract than it managed in past.
Thanks Patrik for the Tip. Cheers!!