There may be no way to exclude China from the process of building wireless networks, and there is definitely none without setting 5G development back significantly

Arild Vollan

Published: 2:30am, 19 Mar, 2019
Updated: 4:58am, 19 Mar, 2019

The Americans will not relent in their boycott of Huawei, even when challenged. They have warned that the use of Chinese 5G technology will affect intelligence cooperation

During the Mobile World Congress in Barcelona, US President Donald Trump tweeted that
he wanted the US to win markets for its technology “through competition, not by blocking out currently more advanced technologies”. The president has pointed out
that the US would not boycott Huawei if he got a good trade deal with China.

His words reveal what this is really all about – Huawei is being used
as leverage in America’s trade war against China. In Norway, too, the Americans are working on their campaign against Huawei.

The US is locked in a struggle over who gets to control two technologies: artificial intelligence and the next generation of wireless services, like 5G. So far, the US has not managed to produce any evidence that Chinese 5G technology poses a security risk, and Huawei is now taking legal steps
against the American administration as a result of the way it has been treated.

Even if Europe opts for Ericsson or Nokia, it will still use Chinese 5G products. All technology companies have one thing in common – much of their equipment is produced in Chinese factories.

One of Ericsson’s partners in China is Nanjing Panda Electronics, while Nokia has a research and development centre in Hangzhou Hi-Tech Industrial Zone.

American inspectors have probably not called in at Nokia Shanghai Bell or they would have realised that Nokia is, in a real sense, a Chinese company. Most 5G components are produced in China anyway, so it is puzzling that the US insists Europe cannot use Huawei technology.

Boycotting Huawei will simply lead to employees and expertise leaving one Chinese company for another.

Those who are concerned about the potential security risks of using Huawei equipment should be equally worried about the Chinese-produced 5G components/equipment being used by Nokia and Ericsson.

What is the point of the US’ campaign against Huawei when Europe will continue to buy 5G components from China via Nokia and Ericsson?

The US’ main argument against Huawei is that Chinese law obliges individuals and companies in China to cooperate with the Chinese state. But most countries have similar legal requirements, including the US, which in certain circumstances imposes far-reaching obligations on its own citizens and companies.

I have yet to see representatives of American companies in Europe being confronted in the media about how American law might force their European subsidiaries to break European laws to fulfil their obligations to the US government.

It is strange, then, to cite Chinese law as the reason why the US needs to ban Chinese 5G technology. But for American and Chinese companies alike, this is a matter of digital trust; it must be taken seriously.

Bloomberg recently reported that Germany’s top telecoms regulator Bundesnetzagentur “wants to limit equipment supply to ‘trustworthy’ vendors that comply with national safety regulations as well as secrecy and privacy rules”.

Thus, the last word is not said about what Germany will do in the Huawei case.

For Huawei, perhaps it would be wise to separate its international and Chinese activities and do its utmost to effectively and credibly put some distance between itself and the Chinese state.

The US may think Huawei is an easy target, but according to Vodafone UK’s chief technology officer, Scott Petty, this is a dangerous path to tread.

He reminds us that no company can ever prove they are 100 per cent secure; there are risks everywhere. We ought, rather, to be discussing how to properly assess the risks entailed in using various companies.

In Norway, for instance, Telenor’s 4G mobile network does not use Huawei components in its inner network.

The mobile network is controlled by American technology; only the radio network uses Huawei. And the Americans have not yet managed to find and prove the existence of back doors in Huawei products.

The 5G network is an extension of 4G. If Huawei is not used, the existing 4G network must first be dismantled, and this would be a huge undertaking, costing enormous sums of money.

Norway currently has 14,000 Huawei base stations, and the cost of dismantling a Huawei 4G base station and replacing it with a Nokia or Ericsson base station is about 600,000 krones (US$70,500) per station.

Vodafone UK recently issued a strong warning: if the UK wants to stop using Huawei, the roll-out of 5G will be seriously delayed, at enormous cost to the UK. And ultimately it is British subscribers who will have to foot the bill for boycotting Huawei.

Why should Europe pay the costs, take the risks and gamble with their economic development and growth?

Blindly following the US will have enormous consequences for European business. It will delay the development and deployment of artificial intelligence and the next generation of wireless services – just to support the US’ new-found policy of protectionism.

Arild Vollan is a Norwegian commentator and partner in Arctic Development, a company that is engaged in business development in the High North