U.K. Bans the Use of Huawei Equipment for 5G Infrastructure

Reversing a January decision, the U.K. has decided to ban Huawei Technologies gear from its 5G network, giving telecom operators until 2027 to remove existing equipment. Oliver Dowden, the U.K. Secretary of State for Digital, Culture, Media and Sport, said the turnabout was due to U.S. sanctions on Huawei in May. “Given the uncertainty this creates around Huawei’s supply chain, the U.K. can no longer be confident it will be able to guarantee the security of future Huawei 5G equipment,” said Dowden. The Trump administration has been urging allies to join the ban.

CNN reports that the ban will delay rollout of 5G services “two or three years, at a total cost of as much as £2.5 billion ($3.1 billion).” It also “risks a backlash from China as Britain looks for new trading opportunities around the world after Brexit.”

When the U.S. put sanctions in place in May that blocked Huawei’s “ability to manufacture and obtain semiconductor chips using American-made technology,” the U.K. conducted another security review, which led to the decision. Huawei has operated in the U.K. for 20 years.

“[The ban] threatens to move Britain into the digital slow lane, push up bills and deepen the digital divide,” said Huawei U.K. spokesperson Ed Brewster. “Regrettably our future in the U.K. has become politicized, this is about U.S. trade policy and not security.” Last month, Jefferies analyst Edison Lee stated that “based on the current direct export rule that the U.S. put on, I really think that Huawei’s 5G equipment business is in grave danger.”

The Chinese company “lobbied hard to persuade the U.K. government it was a trustworthy partner,” announcing this month that it received the greenlight to build a $1.25 billion research facility in Cambridge.

The U.S. administration warned the U.K. that their mutual “intelligence sharing and military collaboration could be put at risk if Britain went ahead with its [original] plan.” Now, China’s Foreign Ministry spokesperson Zhao Lijian warned that the U.K.’s most recent decision “would have consequences for the wider relationship between the two countries.” European competitors Nokia and Ericsson both declared themselves “ready to fill the 5G void left by Huawei.”

CNBC reports that the earlier January decision “gave Huawei restricted access to the country’s next-generation mobile networks … [with] mobile network operators … required to reduce the share of Huawei kit in noncore parts of their infrastructure to 35 percent by 2023.” “This has not been an easy decision, but it is the right one for the U.K.’s telecoms networks, for our national security and our economy both now and indeed in the long run,” said Dowden.

Huawei U.K.’s Brewster, however, said, “this disappointing decision is bad news for anyone in the U.K. with a mobile phone,” adding that Huawei “will conduct a detailed review” of the impact of the decision on its business in Britain. BT-owned EE, Vodafone and Three, the U.K.’s top mobile network providers, said it will take them “at least five years to swap Huawei telecoms kit out for another vendor’s.”

Related:
U.K. to Ban Huawei From Its 5G Networks Amid China-U.S. Tensions, The Wall Street Journal, 7/14/20
China Warns UK: ‘Dumping’ Huawei Will Cost You, Reuters, 7/15/20