Excluding Huawei could damage UK, warns report

Mobile UK, an industry lobbying group, warns in a report that the downsides to excluding Huawei from 5G infrastructure are considerable, threatening economic performance

Telecoms lobbying group Mobile UK has warned that excluding Huawei from 5G infrastructure could undermine the UK economy.    

According to an independent report from telecoms and infrastructure research specialists Assembly, commissioned by Mobile UK, a restriction placed on Huawei in the telecom supply chain could delay a full 5G launch by between 18 and 24 months.

The report says that any launch delay will result in the UK failing to be a world leader in 5G – an aspiration that has been central to the UK government’s 5G strategy since 2016. Using the government’s own estimates on the benefits of 5G, the cost to the UK economy of a rollout delay is calculated at between 4.5 billion pounds (US$5.9 billion) and 6.8 billion pounds.

As well as the measurable financial impact, the UK will also suffer knock-on deleterious consequences in terms of lower inward investment and lost productivity gains through stagnation of digital infrastructure.

The report says that the importance of early 5G leadership to reap the economic benefits of the technology can’t be understated, adding that “if any restriction were to be imposed on Huawei, many of the benefits associated with 5G leadership could be lost for good, not simply delayed as a result – these include significant productivity gains that stand to benefit the UK’s global economic standing.” 

Competition in the supply chain has so far been good for technological progress and meant that the UK has benefited from cost-effective rollout and strong mobile coverage, adds the report. Across a number of industries which are expected to take advantage of 5G connectivity, new sources of growth and innovation may be delayed with further consequences for consumers and a damaging effect on UK businesses, according to research highlighted in the report.

Building Mobile Britain is a campaign created by Mobile UK seeking to work with national and local governments, as well as interested industry groups, to overcome the challenges posed by expanding the existing mobile networks, while also developing innovative services for customers.

All four mobile operators have advanced plans to launch 5G services.

Assembly notes that in recent months there has been widespread press and media coverage about this contentious issue, with countries such as the US, Australia and New Zealand urging caution over relying on telecommunications equipment made by Chinese companies (specifically Huawei), citing security concerns. The US has appeared to be particularly active in exerting pressure on its allies to follow its stance.

In parallel, the UK Government has been conducting a Telecoms Supply Chain Review. As that review concludes, Mobile UK says that all mobile operators want to ensure that decisions made on vendors that can be used in their networks are proportionate, risk and evidence based.

In November 2018, the UK Government published the terms of reference for its Telecoms Supply Chain Review. The review aims to ensure the security and resilience of UK telecoms networks, quality, availability, and long-term costs of the relevant equipment. The review is considering both market incentives and security risks, likely future scenarios, and any appropriate regulatory and policy action.

It is structured around four streams:

-Economic analysis, to understand the supply chain and the incentives of buyers and vendors;

-Technical analysis, to identify network security risks, and future requirements;

-Sector intelligence, to understand the approaches to network security taken by operators and vendors;

- International engagement, to take stock of other countries’ approaches, as the government recognizes the “global nature” of telecoms supply chain arrangements.

The focus of the review is on the parts of the supply chain relevant to fixed and mobile network security, with particular regard to arrangements and procurement drivers related to terrestrial infrastructure and suppliers for access and core networks.

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Date

9 Apr 2019

Channel

Europe

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