network access services provided by Huawei's HSPA network

operated stably and smoothly, with a call success ratio of

99.7%. In addition, Huawei's HSPA network successfully

passed the stability test for 3G services on a 430 km/h

maglev train in Shanghai successfully.

Accelerating HSPA network deployment by

extensive application of distributed Node Bs

Huawei's innovative distributed Node B is composed of two

parts: BBU and RRU. The BBU which is 1 U in height and 19

inches in width can be flexibly set with other equipment and

adapted to any environment, without the need for special

equipment room. While the RRU can be installed close to the

antenna for reduced feeder loss and improved coverage.

Thousands of distributed Node Bs will be deployed

throughout the network in Madrid and other major cities and

regions of Spain to accelerate the deployment of the HSPA

network. This project began in October 2006. At the initial

stage, the project was to swap and adjust the Node Bs in the

existing network, and this was completed successfully by

December 2006. Professional testing and users' survey

indicated that user experience was improved greatly after the

>65<

Vodafone is one of

the global leaders in

UMTS/HSPA network

operations and services

provision. A business

plan analysis shows

that the adoption of

Huawei's leading HSPA

Node Bs will save

Vodafone 30% TCO

within 5 years. The

successful cooperation

between Vodafone and Huawei represents a great partnership of

win-win in the world's mobile communication industry.

Milestones

In December 2006, Huawei delivers the Phase 1 project of

Vodafone's HSPA network in Spain.

In July 2006, Vodafone Spain chose Huawei to build its

UMTS/HSPA network in Madrid and other major cities in Spain.

In February 2006, Vodafone chose Huawei to supply Vodafone-

branded 3G handsets for its 21 operation countries within 5 years

and the Global Strategic 3G Handset Partnership Agreement were

signed.

In November 2005, Vodafone chose Huawei as its preferred

global 3G supplier.

Selecting new partners to improve its competitiveness

In the Node B OPEX test initiated by Vodafone, Huawei's HSPA

Node B got the best overall evaluation for its small size, low power

consumption, excellent coverage and support of IP transmission.

The call success rate of the existing 3G equipment supplier of

Vodafone was merely 60% when the speed of the Spain AVE was

200 km/h. In November 2005 when the AVE reached the maximum

speed of 250 km/h, the voice, video telephone and high-speed

adjustment, with the receiving signals and signal-interference

ratio increased, and the voice, video and HSDPA throughput

improved.

Vodafone Spain adopts the distributed Node B on a large

scale, with a top output power of 40-watt, which is the

same as the macro Node B. RRU on the tower is the typical

installation scenario of the distributed Node B. For example,

at a station with a 45-meter-high tower in Toledo, Spain, the

RRU was installed close to the antenna and connected with

the BBU under the tower via an optical fiber. In this way, 3

dB feeder loss is saved and better network coverage is

achieved. Since the RRU is compact and lightweight, it can

be hoisted to the tower top easily using a rope, reducing

installation costs.

Adhering to differentiation strategy to strengthen

competitive edges

As one of the leaders in global mobile communication,

Vodafone adheres to the differentiation development strategy.

The first Vodafone-branded 3G handset V710 supplied by

Huawei has been widely applied in 21 operation countries.

Vodafone has an insight into the HSPA network and was

the first to propose the Iub Overbooking concept in the

industry, which can make full use of IP transmission resources,

access more users and save transmission costs by about 30%.

Among the five 3G suppliers of Vodafone, Huawei was the

first 3G supplier to realize the Iub Overbooking function and

pass Vodafone's testing in 2006. In terms of the delivery

ability, Huawei has 40 teams available for the network

deployment. Based on the innovative spirit, Huawei was the

first one in the industry to develop leading solutions such as

distributed Node B, UMTS900, iDBS indoor coverage and

MBMS/CMB (Cell Multimedia Broadcasting) solution first in

the industry, which have helped customers improve network

performance and greatly reduce the total costs of network

deployment.

"Huawei's innovative Node B solution within the

radio access network, fully addresses our

requirements for deploying an HSDPA network. The

Node B solution also enables us to significantly

reduce operating cost, maximize the benefits and

improve our competitive position in the

marketplace.”

---Helmut Hoffmann, Director of Global Networks,

Vodafone Group

Vodafone Extensively Deploys HSPA Distributed Node Bs

Picture 1.7 Roof installation of distributed Node B

Picture 1.8 Express AVE

Picture 1.9 Co-cabinet of BBU and other equipment

Picture 1.10 RRU Hoistedonto the tower by rope

Sp

ain

Picture 1.11 RRU Installed close to antenna

network access services provided by Huawei's HSPA network

operated stably and smoothly, with a call success ratio of

99.7%. In addition, Huawei's HSPA network successfully

passed the stability test for 3G services on a 430 km/h

maglev train in Shanghai successfully.

Accelerating HSPA network deployment by

extensive application of distributed Node Bs

Huawei's innovative distributed Node B is composed of two

parts: BBU and RRU. The BBU which is 1 U in height and 19

inches in width can be flexibly set with other equipment and

adapted to any environment, without the need for special

equipment room. While the RRU can be installed close to the

antenna for reduced feeder loss and improved coverage.

Thousands of distributed Node Bs will be deployed

throughout the network in Madrid and other major cities and

regions of Spain to accelerate the deployment of the HSPA

network. This project began in October 2006. At the initial

stage, the project was to swap and adjust the Node Bs in the

existing network, and this was completed successfully by

December 2006. Professional testing and users' survey

indicated that user experience was improved greatly after the

>65<

Vodafone is one of

the global leaders in

UMTS/HSPA network

operations and services

provision. A business

plan analysis shows

that the adoption of

Huawei's leading HSPA

Node Bs will save

Vodafone 30% TCO

within 5 years. The

successful cooperation

between Vodafone and Huawei represents a great partnership of

win-win in the world's mobile communication industry.

Milestones

In December 2006, Huawei delivers the Phase 1 project of

Vodafone's HSPA network in Spain.

In July 2006, Vodafone Spain chose Huawei to build its

UMTS/HSPA network in Madrid and other major cities in Spain.

In February 2006, Vodafone chose Huawei to supply Vodafone-

branded 3G handsets for its 21 operation countries within 5 years

and the Global Strategic 3G Handset Partnership Agreement were

signed.

In November 2005, Vodafone chose Huawei as its preferred

global 3G supplier.

Selecting new partners to improve its competitiveness

In the Node B OPEX test initiated by Vodafone, Huawei's HSPA

Node B got the best overall evaluation for its small size, low power

consumption, excellent coverage and support of IP transmission.

The call success rate of the existing 3G equipment supplier of

Vodafone was merely 60% when the speed of the Spain AVE was

200 km/h. In November 2005 when the AVE reached the maximum

speed of 250 km/h, the voice, video telephone and high-speed

adjustment, with the receiving signals and signal-interference

ratio increased, and the voice, video and HSDPA throughput

improved.

Vodafone Spain adopts the distributed Node B on a large

scale, with a top output power of 40-watt, which is the

same as the macro Node B. RRU on the tower is the typical

installation scenario of the distributed Node B. For example,

at a station with a 45-meter-high tower in Toledo, Spain, the

RRU was installed close to the antenna and connected with

the BBU under the tower via an optical fiber. In this way, 3

dB feeder loss is saved and better network coverage is

achieved. Since the RRU is compact and lightweight, it can

be hoisted to the tower top easily using a rope, reducing

installation costs.

Adhering to differentiation strategy to strengthen

competitive edges

As one of the leaders in global mobile communication,

Vodafone adheres to the differentiation development strategy.

The first Vodafone-branded 3G handset V710 supplied by

Huawei has been widely applied in 21 operation countries.

Vodafone has an insight into the HSPA network and was

the first to propose the Iub Overbooking concept in the

industry, which can make full use of IP transmission resources,

access more users and save transmission costs by about 30%.

Among the five 3G suppliers of Vodafone, Huawei was the

first 3G supplier to realize the Iub Overbooking function and

pass Vodafone's testing in 2006. In terms of the delivery

ability, Huawei has 40 teams available for the network

deployment. Based on the innovative spirit, Huawei was the

first one in the industry to develop leading solutions such as

distributed Node B, UMTS900, iDBS indoor coverage and

MBMS/CMB (Cell Multimedia Broadcasting) solution first in

the industry, which have helped customers improve network

performance and greatly reduce the total costs of network

deployment.

"Huawei's innovative Node B solution within the

radio access network, fully addresses our

requirements for deploying an HSDPA network. The

Node B solution also enables us to significantly

reduce operating cost, maximize the benefits and

improve our competitive position in the

marketplace.”

---Helmut Hoffmann, Director of Global Networks,

Vodafone Group

Vodafone Extensively Deploys HSPA Distributed Node Bs

Picture 1.7 Roof installation of distributed Node B

Picture 1.8 Express AVE

Picture 1.9 Co-cabinet of BBU and other equipment

Picture 1.10 RRU Hoistedonto the tower by rope

Sp

ain

Picture 1.11 RRU Installed close to antenna