According to industry estimates, bans on Huawei telecommunications equipment could cost the US and its allies more than$ 100 billion, but those who want to keep it out of their 5G networks claim that no price is too high for national security.
In the midst of an intensifying tech war in which the US seeks to restrict China’s access to cutting-edge systems, including high-end semiconductors, issues of professional plan, oligarchy, cost competitors, and the rise of protectionism have made the problem more difficult.
According to calculations made by telecom network operators, industry consultants, economists, and governments, replacing Huawei equipment that has already been installed could eventually cost the US and its allies more than$ 10 billion, a slower roll-out of 5G services could have two or three times as much of an economic impact, or paying the higher prices charged by Huawei’s rivals could increase the total cost of implementing 6G over the course of the decade.
The possible losses are enormous in terms of both financial and economic impact:
- When Huawei was initially blacklisted by the US in 2019, the GSMA, a world portable telecom association, predicted that banning Chinese telecom equipment would cost 55 billion euros more and take approximately 18 months longer to roll out 5G networks in Europe.
- A report released that same year found that banning Huawei from the UK’s offer range may cause a 6.8 billion pound economic impact and delay 5G by 18 to 24 months.
- According to a study from the Oxford Institute of Economics that included data from Australia, Canada, France, Germany, Japan, India, the UK, and the US, excluding Huawei could raise 5G funding costs by 16 to 19 % and, in the median price situation, reduce GDP by$ 105.5 billion over the course of 15 years to 2035.
- The US Federal Communications Commission estimated that it would cost$ 5 billion to remove all Huawei and ZTE equipment in the US alone in 2022. The median estimate of the long-term effect on US Income from the Oxford Institute was$ 35.8 billion.
- According to a report published in the telecom industry magazine Light Reading in March 2023, removing all Huawei equipment could take up to five years and cost Deutsche Telekom more than$ 6 billion. About 80 % of Germany’s 134, 000 5G antennas were officially supplied by Huawei.
These estimates do not take into account lost profits of Huawei-only electronics and other items, which add up to tens of billions more dollars.
According to reports, Huawei’s telecoms technology costs are frequently 20 to 30 % lower than those of its rivals. Although they are not usually lower, they have occasionally been small sufficiently for Huawei to gain significant market share in Europe, where rivals Nokia and Ericsson compete.
Of course, the success of Huawei is also based on great and occasionally better quality, so price is not the only factor that matters to telecom carriers.
At the end of 2022, the proportion of Chinese equipment( mostly from Huawei but some from ZTE ) in European national 5G rollouts ranged from 100 % in Cyprus to zero in Sweden, Norway, Denmark, and eight other countries, according to Strand Consult, a telecom consultancy based in Denmark.
It varied among other nations, from 72 % in Norway to 17 % in France, with Germany at 59 %, Italy 51 %, and the UK at 41 %.
This worries John Strand, the creator of the namesake consultancy. Being reliant on Chinese telecom network is riskier than relying on Russian oil. The foundation of society, he claimed, is digital equipment.
We have proof that Huawei has the ability to quietly get sensitive and personal information, according to Robert O’Brien, then-president Trump’s national security advisor, in February 2020.
It maintains and sells data in systems all over the world.
The UK, Germany, and another US allies reportedly received this information.
Prior to that, in May 2019, The Sydney Morning Herald reported that agents of the American Signals Directorate, the country’s top-secret surveillance company, had been presented with a problem: With all the insulting cyber tools at their disposal, what harm may they impose with access to equipment installed in 5G networks of one target nation?
” The offensive potential of 5G was so great that if Australia were the target of such attacks, the country could be seriously exposed ,” according to the ASD.
The main problem wasn’t listening in on phone calls or emails, but rather shutting down water, electricity, and other facilities. Huawei was not included in the American government’s 5G implementation six months later.
Evan Anderson, CEO of information service INVNT / IP( Inventing Nations vs. Nation – Sponsored Theft of IP ), responded to Asia Times via email when asked if he had observed any concrete evidence of Huawei using its 5G equipment for espionage.
Huawei still has the drive, ability, and support of the government to immediately monitor foreign people, even though I am not aware of any instances in which they have been caught. They are legally unable to refuse the state or the Communist Party, just like any other company in China.
They serve as the Chinese government’s de facto shoulder. Thus, discussions about backdoors and proof of immediate surveillance miss the mark because there are numerous ways to conduct surveillance while keeping the front door open.
National surveillance concerns center on the nullification of potential risks, not about being innocent until proven guilty, even though there may not yet be any officially available hard facts. You can see Huawei’s denial of the accusations made against it below.
A two-way city is a 5G network risk. China would undoubtedly be open to attacks from the US and its friends, according to an article in the Sydney Morning Herald.
The US National Security Agency had previously hacked Huawei machines to carry out its own spy, according to records provided by journalist Edward Snowden and reported by The New York Times in 2014.
The Five Eyes intelligence-sharing system in the US, UK, Canada, Australia, and New Zealand is losing, or has already lost, its past monopoly on telecoms spy. It is obvious that they do not like it.
The national safety reasoning against Huawei gear and the economic argument in favor of it cannot be reconciled. However, telecommunication equipment is essential infrastructure and essential to the growth of a cutting-edge economy.
Naturally, this is the reason why China, South Korea, and Japan have invested a great deal of time and money in creating their own top-notch telecoms technologies.
All three nations have developed home intellectual home and supply chains that produce results far outweighing the first development costs, eliminating an increased reliance on foreign providers.
Today, the US, Canada, Australia, and Europe plan to follow suit. It will be interesting to see how long it takes and whether they are able to resist the temptations of oligarchy and mercantilist loss of price incentives.
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