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Vodafone Group PLC said yesterday it has signed a five-year global supply deal with Huawei Technologies Co. for exclusive Vodafone-branded third-generation (3G) handsets.

The deal represents Huawei's first significant handset deal in Europe and will enable Vodafone, the world's largest wireless operator by sales, to offer branded 3G handsets at low prices.

Shenzhen-based Huawei has made significant inroads in the telecommunications network equipment market in Europe and around the world by offering much cheaper kit than established suppliers.

Vodafone, the world's biggest mobile operator by revenues, anticipates offering the first Huawei-manufactured 3G handset in September 2006 this year. The handsets, which will be sold by Vodafone in 21 countries, will only carry the Vodafone name.

Neither side disclosed the scale of the order or any pricing details.

"This agreement with Huawei shows the cost benefits Vodafone's size and global reach can bring to our customers," Vodafone chief marketing officer Peter Bamford said.

"We will be able to offer even better 3G phones at more competitive prices across our markets."

Huawei, which is China's top telecom equipment maker, said the agreement with Vodafone would help it to become a leading player in the world in handset development and production.

"This agreement offers us a great opportunity to expand into new regions alongside the world's leading mobile community," said Ping Guo, senior vice president at Huawei.

Huawei signed a global supply deal with Vodafone in November for network infrastructure.

(Shenzhen Daily February 16, 2006)