New US sanctions could impact the 5G infrastructure plans that Huawei and the UK agreed to earlier this year.
At the beginning of the year, the UK gave Huawei the green light to contribute to the country’s 5G network infrastructure, while subjecting the Chinese telecoms business to strict limits.
However, it now appears that the UK could be set to reduce Huawei’s role further. On Friday (22 May), the Guardian reported that UK prime minister Boris Johnson has caved to pressure from Conservative backbenchers, and has begun to draw up plans to reduce Huawei’s involvement to zero by 2023.
Much of the concern around Huawei’s involvement in the UK’s 5G infrastructure relates to fears about data privacy and mass surveillance. However, British intelligence agencies supported the go-ahead in January, arguing that they could contain any risks of mass surveillance.
Originally, the UK government said that Huawei would not be able to work in ‘core’ functions of national government including sensitive geographical locations such as nuclear missile bases. The company would also have access to no more than 35pc of the entire UK 5G network, with a presence in the periphery ‘access network’.
In recent weeks, the US has increased its sanctions on Huawei due to its own concerns, with new rules that prevent manufacturers of semiconductors using American technology in their operations from shipping their products to Huawei unless they get a licence from the US.
Because of these new sanctions, the UK’s National Cyber Security Centre (NCSC) said it will conduct an emergency review of the deal the UK made with Huawei in January.
A spokesperson for the NCSC told the BBC on Sunday (24 May): “The security and resilience of our networks is of paramount importance. Following the US announcement of additional sanctions against Huawei, the NCSC is looking carefully at any impact they could have to the UK’s networks.”
With Huawei prevented from using US semiconductors and technology, UK government sources told the Guardian there are concerns that Huawei will become reliant on “unfamiliar and untested components”, which could be exploited.
The Guardian added that the NCSC is expected to conclude that the latest sanctions will make it impossible for Huawei’s technology to be used in UK 5G networks. It said that the move risks irritating China and adding hundreds of millions in costs to BT and other UK phone companies.
In response to the review, Huawei vice-president Victor Zhang said that the company is happy to discuss concerns with the NCSC.
What could happen?
Huawei has said that the latest sanctions imposed on the company by the US will damage trust and collaboration within the global semiconductor industry.
Huawei’s rotating chair Guo Ping recently admitted the toll that the sanctions have had on the company, stating that while it is able to design some semiconductor parts, it is “incapable of doing a lot of other things”.
“Survival is the keyword for us at present,” Ping said at a conference earlier this month.
For the UK, the consequences of a decision to completely remove Huawei from its infrastructure plans could affect how quickly internet access is rolled out and how much it will cost, the BBC explained.
The move may ease tensions between the UK and the US, but Huawei has said that it would be bad for competition. The Chinese telecoms giant has two major competitors in the 5G space – Nokia and Ericsson.
Zhang told the BBC: “More suppliers means greater competition, innovation and network reliability, and crucially ensures consumers have access to the best possible technology. Removing Huawei would seriously delay 5G, costing the British economy up to £7bn.”
An impact on broadband
Huawei also plays a significant role in the UK’s fixed-line broadband infrastructure, accounting for 44pc of the equipment used in providing full-fibre connections to homes, offices and other buildings, according to Ofcom.
BT wants to reduce that figure to 35pc by introducing more technology from Nokia and Adtran. However, tens of thousands of fibre broadband roadside cabinets in the UK belong to Huawei.
Andrew Ferguson, editor-in-chief of ThinkBroadband, told the BBC: “They connect directly to the core of the network, but replacing those is a complete non-starter unless someone’s going to throw many billions of pounds at it and also all the people to do the work.”
While opponents of Huawei want to see the company’s equipment reduced in broadband infrastructure, this may be impractical in the short term.
Commenting on the 5G situation, Zhang said: “As a private company, 100pc owned by employees, which has operated in the UK for 20 years, our priority has been to help mobile and broadband companies keep Britain connected, which in this current health crisis has been more vital than ever.”