UK to decide on Huawei role amidst pressure from USA

The UK government is expected to decide on whether to allow the technology giant Huawei to participate in the rollout of its 5G network. British officials will reportedly greenlight the use of Huawei equipment in such networks.

The US has ramped up pressure on the UK government to exclude Huawei from the country’s 5G network by threatening that allowing Huawei to operate its 5G network could put transatlantic intelligence-sharing or even the trade deal at risk.

In spite of US pressure, British Prime Minister Boris Johnson insisted the UK can have technological progress while preserving national security.

In his interview with BBC earlier this month, Johnson said: “The British public deserves to have access to the best possible technology. We want to put in gigabit broadband for everybody. Now if people oppose one brand or another then they have to tell us what’s the alternative.”

UK’s telecoms companies have been using Huawei in its networks for the past 15 years, during which the world’s largest telecom equipment supplier kept a proven clear cybersecurity track record.

The US administration has been trying to convince its allies not to allow the Chinese tech giant to form their 5G networks, claiming it would be a security risk, without providing any evidence.

There is evidence shows excluding Huawei would cost the UK economy £7 billion and result in more expensive 5G networks, raising prices for anyone with a mobile device.

British Government has full access to evaluate Huawei product ranges through Cyber Security and Evaluation Centre, opened in the country in 2010. The oversight board of the facility is chaired by the Chief Executive Officer of the UK’s National Cyber Security Centre with members from the government including Government Communications Headquarters, as well as the UK telecommunications sector.

UK security agencies believe they have managed security concerns around the Chinese supplier so far and will be able to do so with the 5G network.

The director-general of MI5, Andrew Parker, said earlier this month that he had “no reason to think” that using Huawei technology should threaten intelligence sharing with the US.

The British government has reiterated that the “sustainable diversity in the 5G supplier market” is the centerpiece of the resilience of telecom networks, not just a question of in or out.

Many believe that cutting competition by a reduction to just two vendor choices, cannot be good for the market and consumers, neither helpful to strengthening the resilience of telecoms networks that the UK government describes as “of paramount importance”.

Dexter Thillien, a senior TMT analyst at Fitch Solutions, told CNBC that“Three is better than two,” he said, “If you ban Huawei, you have a choice between Ericsson and Nokia. You lack competition.”

In the interview with BBC, Johnson said: "There's no reason why we shouldn't have technological progress here in the UK, allow consumers, businesses in the UK to have access to fantastic technology, fantastic communications, but also protect our security interests and protect our key partnerships with other security powers around the world."

Despite the US’ restrictions and a prolonged campaign against its business, Huawei remains a leader in 5G competitive landscape. According to IPlytics GmbH, Huawei is the No.1 in terms of the number of 5G Standard Essential Patents (SEPs) and the number of 5G standards contributions. Huawei ranks 5 in terms of R&D investment on the 2018 EU R&D Investment Scoreboard, followed by Nokia(27) and Ericsson(45).

Huawei has played an important part in helping its UK carrier partners to develop and roll out both fixed and mobile networks throughout the UK. Huawei stimulated a £1.7 billion contribution to UK GDP in 2018 alone, according to research by Oxford Economics. Furthermore, Huawei is found to have supported 26,200 jobs across the UK in 2018. This economic activity generated £470 million in tax revenues for the Exchequer.

Across the EU, no government has yet imposed an outright ban on Huawei. Operators warn that banning Huawei may add years of delays and billions in costs to European countries’ 5G network launch.

As Germany will take on the rotating presidency of the Council of the European Union in the second half of this year, German Chancellor Angela Merkel said last week diversification is crucial to ensuring a country's security in the roll-out of 5G mobile technology and shunning one supplier altogether risks being counterproductive.