China's Huawei signs Aussie fibre deal

While New Zealand talks about buying Huawei gear, the Aussies are selling stuff to the Chinese telecommunications equipment maker

While New Zealand talks about buying Huawei gear, the Aussies are selling stuff to the Chinese telecommunications equipment maker

The Shenzhen-based company has just inked a down-under deal - but it's with an Australian company, not anything to do with John Key's hints over the weekend about a major New Zealand investment.

Under a deal announced today by New South Wales premiere Kristina Keneally, NSW company Finisar will extend its contract to supply Huawei with digital wavelength processors (DWP) - a key component for the Chinese company's fibre optic switching gear.

A DWP helps a Huawei fibre switch respond to increasing bandwidth demands as bandwidth is used variously for voice, data, video, mobile wireless or storage services.

Ms Keneally, in Shanghai for the start of NSW Week at the World Expo, said the deal would create 95 jobs in her state.

A DWP a piece of hardware about the size of a tissue box, and has to be made by hand. One unit takes nine days to complete.

The Finisar DWP is 100% Australian designed and manufactured.

In the US, politicians have had qualms about American companies doing business with Huawei. Lawmakers blocked a $US2.2 deal that would have seen the Chinese company (in partnership with Bain Capital) buy US network hardware maker 3Com in 2008 for $US2.2 billion.

Concerns were cited about 3Com's security technology falling into foreign hands (3Com was eventually bought by HP, for $US2.7 billion, in a deal finalised in Feburary this year).

However, in Finistar's instance there are no obvious security implications, and Ms Keneally was an active proponent of the deal.

Finistar says it is on track to have 300 emploees by Christmas.

Huawei has around 200 staff at its Australian headquarters in Sydney. The company also sells its mobile network switching gear to Vodafone and 2degrees in New Zealand.