Monday, February 24, 2020

Huawei Is Winning the Argument in Europe, as the U.S. Fumbles to Develop Alternatives

Huawei, the large telecom giant has been a topic of contention for most international governments. Whether they should side with the United States and reject Huawei from their networks or forgo U.S. warnings and decide to build new 5G networks with Huawei.

Both sides have received wins and losses. The U.S. has some success in getting Huawei banned from
Australia and Japan while Huawei has some success in getting permission to build 5G networks in the UK and possibly Germany with strict monitoring and other conditions. This is a problem for the U.S because the two European countries are close allies when it comes to intelligence-sharing and the worry that China will be given a back door to spy.The problem with this is that despite U.S. warnings, the U.S. has not come up with a cheaper alternative to Huawei. Nokia and Ericsson are alterantives but are more expensive and there are no American firm that have developed an alternative for 5G.

But a huge reason for the inclusion of Huawei in the UK and Germany is due to China being a critical trading partner and fear of retaliation from China. With the UK leaving the EU, their trading relationship with China will be a top priority along with the U.S. The UK will need to balance their relationship with both superpowers without alienating the other which will be harder to do. Germany's economy is mostly export dependent (ie. Daimler, BMW, Mercedes-Benz,etc) with a large portion of those exports going to China. This is a problem that many countries are facing: choose the U.S. and potentially be locked out of 5G advancement or Chinese retaliation on goods or choose to include Huawei and have 5G networks and Chinese goodwill or possible Chinese espionage.

https://www.nytimes.com/2020/02/17/us/politics/us-huawei-5g.html?auth=login-google1tap&login=google1tap

4 comments:

Anonymous said...

Huawei has been putting a very strong emphasis on their advertising lately to change their image in order to combat the negative public perception of the company and reinforce their brand by entering new international markets. Due to the amount of skepticism surrounding the technology company, I believe Huawei needs to show their expertise in the 5g network to win over governments to implement their services, as well as proving their independence in regards to secure data collection with the Chinese government

Fatima Iqbal said...

Keeping low prices, and being heavily funded by Chinese Development Banks, Huawei is heavily investing in global market. Not only in European markets, but I also see increase in its share in Asian markets. Huawei maintains its neutrality and due to maintenance of low prices, it will continue to expand.

Scott Sidner said...

I think it also should be considered too that the EU has stricter anti-trust and free market laws, making it easier for Huawei to enter the market and harder for countries in the EU to keep it out. Tech companies across the US are most likely hard at work at creating a competitor to Huawei, and I do not see the US caving in to let Huawei enter our market anytime soon in hopes that a US firm can find a way to compete instead.

Cody Gault said...

It's always sad to see a company like this have to face social stigma because of its relationship to China. I personally don't think that Huawei's intentions are to aid the Chinese government in espionage and that countries with fears like the US should give more consideration.