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WESTERN concerns over Chinese involvement in telecommunications infrastructure are unwarranted, says the head of the Asian arm of British telecoms giant BT Group.
Kevin Taylor, managing director of BT Asia-Pacific, says in Hong Kong that the group's partnership with Chinese telecoms company Huawei in Europe has been a positive -- and safe -- experience.
The Gillard government has banned Huawei from tendering for contracts associated with the $36 billion National Broadband Network due to concerns about cyber security.
Taylor says the security of BT's European ventures with Huawei reinforce why market forces rather than security concerns should be the driving force in the industry.
"There's a huge amount of protectionism against Chinese companies," Taylor says.
"But we took (Huawei) into the UK and we've passed all the security provisions. We know exactly what's in that network, and we've got rigid quality assurance to ensure there's no security risks."
Huawei is a strategic partner in developing BT's broadband network in Britain.
Taylor, who has lived in Asia for 18 years, says Australia should avoid the protectionism towards China that has surfaced in the US.
"If Australia really wants to be an integrated player in Asia, it can't be anti-Chinese," he says.
Taylor also raises questions about the structure of the NBN, flagging concerns about how the cost of the project will translate into pricing.
He warns it is difficult to see how the $36 billion project could ultimately compete on price with other countries.
"It's important that the NBN becomes competitive and that the costs are consistent with other countries for efficiency purposes," he says.
"Whether that calculation works out or not I don't know, but I hope it does."
The government-run structure being pursued in Australia contrasts with that in Britain, where government regulation forced BT in 2006 to ring-fence many of its infrastructure assets in an independent subsidiary.
That subsidiary, called Openreach, sells access to all service providers -- including BT -- at the same price.
That approach is in contrast with the Australian government's establishment of NBN Co as a wholesale monopoly supplier of fixed-line broadband services.
Telstra, Australia's largest telecoms company, is being paid $9bn by NBN Co to decommission its copper network and transfer its customers, and its fixed-line monopoly, to the new network.
The regulatory change hit BT hard at the time, but the change came at a negligible cost to taxpayers and created a fiercely competitive market.
There are now more than 2000 competitors in Britain's broadband market, Taylor says.
"It has meant the UK is the most competitive telecoms market in the world and broadband costs are the cheapest in the world. It has been a big success."
BT's cheapest broadband package in Britain costs pound stg. 6.99 ($11) a month, while a more comprehensive package retails for about pound stg. 25.
In contrast, the big outlay for the NBN means low pricing could be difficult to achieve.
"I don't know if the (NBN) model will get to a cost level such as you get in the UK," he says.
Taylor says the British approach could also have worked in Australia.
But instead, Telstra should be "very happy" with the outcome it negotiated with the government.
"Telstra has done very well out of it. They've got a significant amount of money."
Despite his reservations on the model, Taylor says the NBN would put BT in a good position to pursue its business model in Australia.
BT does not intend to enter Australia's retail market and is instead focusing on providing value-added telecoms services to business.
"Telstra has got a huge amount of the market -- it has got all the market really -- and what the NBN will do is give us a level playing field with the Telstras and Optuses to provide value-added services to business enterprises in Australia," Taylor says. "That will be fantastic for us."
BT is focused heavily on adding value on top of providing basic telephone services. It owns and operates the Radianz network, which carries about 40 per cent of the world's financial transactions, and it has executed a major contract to overhaul communications in Britain's National Health Service.
In Australia, the group has won a contract at the under-construction Fiona Stanley hospital in Perth, its first foray into the local health sector.
Taylor says the group's 200 employees in Australia -- based in Perth, Melbourne and Sydney -- are particularly interested in building exposure to the booming resources industry.
"We're very excited by the opportunities in Western Australia. The oil and gas sector is something we really want to push at, and when you look at (Rio Tinto's automated) Mine of the Future and things like that, there's so much innovation in Western Australia that we'd love to get involved in."
BT, which is active in 170 countries, doesn't break down its earnings geographically, but Taylor says the Asia-Pacific division is recording double-digit growth and is expected to continue doing so.
The group has pushed into China despite a regulatory regime that is "probably one of the worst in the world", and is also active in India.
"India is very, very important -- it just needs more stability politically," he says. BT is weighing its options there. "We are invested in India but the environment needs to be right."
He is bullish on Asia generally and China specifically.
His experiences with China and Chinese telecoms technology have left in him in no doubt that its economy could deliver the technical innovation many commentators say it needs to keep growing beyond its infrastructure-driven boom.
"I think China is already one of the most innovative economies in the world," he says.
"I think it will be the technology innovator of this century.
"It took decades and decades and decades for China to get its first mobile, to get full telephony, and now it has got companies like Huawei offering some of the most advanced technology in the world. It's just amazing.
"I really see this going into other areas. I really think they're going to be an amazing innovator."
Cookies must be enabled. | The Australian
Kevin Taylor, managing director of BT Asia-Pacific, says in Hong Kong that the group's partnership with Chinese telecoms company Huawei in Europe has been a positive -- and safe -- experience.
The Gillard government has banned Huawei from tendering for contracts associated with the $36 billion National Broadband Network due to concerns about cyber security.
Taylor says the security of BT's European ventures with Huawei reinforce why market forces rather than security concerns should be the driving force in the industry.
"There's a huge amount of protectionism against Chinese companies," Taylor says.
"But we took (Huawei) into the UK and we've passed all the security provisions. We know exactly what's in that network, and we've got rigid quality assurance to ensure there's no security risks."
Huawei is a strategic partner in developing BT's broadband network in Britain.
Taylor, who has lived in Asia for 18 years, says Australia should avoid the protectionism towards China that has surfaced in the US.
"If Australia really wants to be an integrated player in Asia, it can't be anti-Chinese," he says.
Taylor also raises questions about the structure of the NBN, flagging concerns about how the cost of the project will translate into pricing.
He warns it is difficult to see how the $36 billion project could ultimately compete on price with other countries.
"It's important that the NBN becomes competitive and that the costs are consistent with other countries for efficiency purposes," he says.
"Whether that calculation works out or not I don't know, but I hope it does."
The government-run structure being pursued in Australia contrasts with that in Britain, where government regulation forced BT in 2006 to ring-fence many of its infrastructure assets in an independent subsidiary.
That subsidiary, called Openreach, sells access to all service providers -- including BT -- at the same price.
That approach is in contrast with the Australian government's establishment of NBN Co as a wholesale monopoly supplier of fixed-line broadband services.
Telstra, Australia's largest telecoms company, is being paid $9bn by NBN Co to decommission its copper network and transfer its customers, and its fixed-line monopoly, to the new network.
The regulatory change hit BT hard at the time, but the change came at a negligible cost to taxpayers and created a fiercely competitive market.
There are now more than 2000 competitors in Britain's broadband market, Taylor says.
"It has meant the UK is the most competitive telecoms market in the world and broadband costs are the cheapest in the world. It has been a big success."
BT's cheapest broadband package in Britain costs pound stg. 6.99 ($11) a month, while a more comprehensive package retails for about pound stg. 25.
In contrast, the big outlay for the NBN means low pricing could be difficult to achieve.
"I don't know if the (NBN) model will get to a cost level such as you get in the UK," he says.
Taylor says the British approach could also have worked in Australia.
But instead, Telstra should be "very happy" with the outcome it negotiated with the government.
"Telstra has done very well out of it. They've got a significant amount of money."
Despite his reservations on the model, Taylor says the NBN would put BT in a good position to pursue its business model in Australia.
BT does not intend to enter Australia's retail market and is instead focusing on providing value-added telecoms services to business.
"Telstra has got a huge amount of the market -- it has got all the market really -- and what the NBN will do is give us a level playing field with the Telstras and Optuses to provide value-added services to business enterprises in Australia," Taylor says. "That will be fantastic for us."
BT is focused heavily on adding value on top of providing basic telephone services. It owns and operates the Radianz network, which carries about 40 per cent of the world's financial transactions, and it has executed a major contract to overhaul communications in Britain's National Health Service.
In Australia, the group has won a contract at the under-construction Fiona Stanley hospital in Perth, its first foray into the local health sector.
Taylor says the group's 200 employees in Australia -- based in Perth, Melbourne and Sydney -- are particularly interested in building exposure to the booming resources industry.
"We're very excited by the opportunities in Western Australia. The oil and gas sector is something we really want to push at, and when you look at (Rio Tinto's automated) Mine of the Future and things like that, there's so much innovation in Western Australia that we'd love to get involved in."
BT, which is active in 170 countries, doesn't break down its earnings geographically, but Taylor says the Asia-Pacific division is recording double-digit growth and is expected to continue doing so.
The group has pushed into China despite a regulatory regime that is "probably one of the worst in the world", and is also active in India.
"India is very, very important -- it just needs more stability politically," he says. BT is weighing its options there. "We are invested in India but the environment needs to be right."
He is bullish on Asia generally and China specifically.
His experiences with China and Chinese telecoms technology have left in him in no doubt that its economy could deliver the technical innovation many commentators say it needs to keep growing beyond its infrastructure-driven boom.
"I think China is already one of the most innovative economies in the world," he says.
"I think it will be the technology innovator of this century.
"It took decades and decades and decades for China to get its first mobile, to get full telephony, and now it has got companies like Huawei offering some of the most advanced technology in the world. It's just amazing.
"I really see this going into other areas. I really think they're going to be an amazing innovator."
Cookies must be enabled. | The Australian
