The use of the Chinese manufacturer’s components in Europe is controversial. (Photo: Pixabay)
Huawei loses footing in the World market. As disagreements over the Chinese network supplier intensify. Germany remains undecided. What does the future hold for the further 5G expansion?
Monday, 25.07.2022: The Handelsblatt reports, citing information from the Interior Federal Ministry, that Berlin could prohibit network operators from using “critical components” made by Chinese manufacturers. Conversely, the federal government reserves the right to legally restrict cooperation with the Chinese company Huawei for the construction of the 5G network in Germany.
Even the use of already installed components could thus be prohibited. “Insofar as their further use is likely to impair the public order or security of the Federal Republic of Germany, in particular, if the manufacturer of the critical component is not trustworthy,” the newspaper quotes the ministry as saying.
Huawei loses credibility and major clients
Huawei counts among the world’s largest telecommunications equipment suppliers and is a key player in 5G technology. However, several G20 countries, including the US and the UK, have barred the provider from expanding their 5G networks. The reason: their concerns that Huawei technology could be a gateway for Chinese espionage or sabotage.
According to Bloomberg, more than one-third of the world’s GDP-bearing countries have banned products by the Chinese smartphone and wireless technology company Huawei since 2019. Not just big players like the USA and UK, but the ban has also been imposed by Australia, New Zealand, Canada, Japan, Sweden, India, and Taiwan. Meanwhile, Great Britain has banned the company from contributing core parts to 5G technology, cutting Huawei’s share in the country’s new network to 35 percent.
As of May 20, 2022, wireless carriers in Canada won’t be allowed to install Huawei equipment in their high-speed 5G networks. NPR argued, that in doing so, the Canadian government has joined its allies in curbing commerce with the Chinese technology giant.
Germany’s dilemma: 5G or politics?
The German network operators have nevertheless opted to continue to rely on the company. However, both Deutsche Telekom and Vodafone assure that they do not use Huawei technology in the so-called core network, but only on the radio masts themselves. A retrofit in Germany would probably be very complex and expensive. The network operators have only a limited choice of equipment suppliers anyway: Besides Huawei, Ericsson and Nokia are still active in the European market. Telekom points out that it can only install 5G components on top of the 4G components already installed by the same manufacturer. Germany’s hesitancy in alienating itself from the Chinese company can be explained by its heavy reliance on the “existing suppliers” Huawei and Ericsson. A Telekom spokesperson told SPIEGEL that the company does not want to participate in “political speculation” for now.
“It would be unworldly and naïve not to recognise the geopolitical significance of Huawei’s activities in Germany for China’s influence.”
Konstantin Kuhle, deputy leader FDP to Handelsblatt
Politicians from the German coalition have also been voicing their concerns about this. “It would be unworldly and naïve not to recognise the geopolitical significance of Huawei’s activities in Germany for China’s influence”, Konstantin Kuhle, deputy leader of the FDP parliamentary group in an interview with the Handelsblatt”. The deputy parliamentary party leader of the Greens, Konstantin von Notz, referred to the current gas crisis: It must now be clear to all “that one should not hand oneself over economically to dictatorships with an imperialist attitude in order not become vulnerable to blackmail”. Offering a hint at Germany’s present lack of options when it comes to 5G-tech providers if Huawei were to be completely out of the picture.
Against the backdrop of the Russian-Ukraine crisis, where China is politically involved, along with the rest of the political unrest stirred by the eastern superpower, its clientele nations have put themselves on high alert.
Huawei is currently on the US Department of Commerce’s Entity List, which restricts its access to items produced with US technology and software.
The US fears that Huawei’s 5G equipment could be used by China for spying. According to several US sources, the FBI had expressed concerns that Huawei components on cell towers in remote areas could be used to monitor or tamper with important military communications, including radio traffic from nuclear weapons military bases. Whereby, the US Federal Communications Commission (FCC) has even ordered certain American telecommunications companies to remove Huawei equipment from their network.
Although, Huawei has consistently denied the allegations and findings, by insisting that the said equipments under critique, operate on different frequencies than US military communications. This replacement is now weighing heavy on the taxpayers’ pockets. Media reports show, that 1.9 billion dollars have already been approved to compensate the mobile phone operators. Whereby, the costs could shoot up to more than three billion dollars beyond budget soon.
Whilst Germany’s response to this global outcry remains relatively lukewarm, as it finds itself in a precarious situation with limited options. Only time shall tell, whether Huawei can successfully clear its name of the slanders and accusations, and regain the trust of its global clients.
You wish to read more on how Huawei is dividing German politics? Click here to read the entire article.
The concept of an Open RAN architecture could present a way out of the Huawei dilemma. Click on the link to read more.
Dorothee Bär (Minister of State for Digitalisation) does not confirm the general exclusion of Huawei. Watch our German interview on YouTube here.
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What is Huawei’s take on this matter? Watch our interview (in German) with Walter Haas (CTO / CSO Huawei Germany). Who calls for more dynamism in Germany. Click here to visit the YouTube Video.
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