Friday Rant - if your business plans depend on 5G, think carefully about what you do next given the Huawei psycho-drama!

Profile picture for user mbanks By Martin Banks June 26, 2020
Summary:
Political talk of ousting Huawei as a provider of 5G kit would come at a huge cost for Brexit Britain, both in terms of cost and technological ambition. An aggrieved UK taxpayer makes his case for everyone calming down.

ranting
(Pixabay )

Banning Huawei as a major supplier of 5G comms equipment will stop dead the global leadership ambitions that the UK Government lusts after - and force every CIO to reconsider their plans. They will end up having to inform C-Suite colleagues that many future business plans are suddenly off the table. Oh, and the cost, based on government numbers, can be expected to be well into the £-billions!

A grim scenario? The next two years are already set to be vital for the UK, what with the need to kickstart the economy after the Coronavirus pandemic at the same time as re-aligning it for what increasingly looks like a no-deal Brexit crash out from the trading relationship with the EU.

One key part of the ‘plan’ for making this all happen is that the UK will become a leader in the deployment and use of 5G –in other words, the country to be in if your business needs the kind of communications capabilities that 5G can offer. The other is an inter-locking complement, that posits that the UK also becomes a world leader in the development and exploitation of Artificial Intelligence systems. When combined, these provide a potential  route to new sources of revenue and new jobs.

The majority of those new revenue sources will combine the capabilities of analytics, AI, distributed `edge’ computing, IoT, 5G communications and the Cloud. This is a collection of technologies where the UK has indeed already generated important experience and expertise, not so much in the design and development of them, but more in the important `how to’ skills of getting the best out of what these technologies can provide. This is where the future potential for real growth can be seen; it’s also what now stands in danger of being lost for good, not just `let slip for a bit’.

That potential is now at risk before it has had any real chance to get going, placing the plans of many 5G early adopter businesses in limbo. The stance taken by the British Government about the role of Chinese telecoms equipment supplier Huawei in the roll out of 5G communications services in the UK has placed a huge question market over the whole 5G capability spectrum on which the post-Brexit country is planning to depend.

A 'high risk vendor'...after 20 years

A squad of MPs on the Government back benches are determined to have Huawei permanently labelled as a ‘high risk vendor’ because being Chinese makes it a security risk. It must, therefore, be off the desk when it comes to choosing suppliers for the 5G roll-out. That would be fine,  if it weren’t for the uncomfortable fact that there are no alternative vendors that are as far advanced in the development and delivery of 5G network equipment and, because of a quirk in the development of 5G standards, there is a good deal of initial commonality of such equipment with the current 4G services.

Now, as Global VP Victor Zhang has pointed out in a open letter to the UK, Huawei has been supplying comms systems to the UK for some 20 years and was integral to the installation and operation of both 3G and 4G services. The success of 4G led to the decision that the early stages of 5G installation would piggyback off as much of the installed 4G equipment as possible. That is one reason for the UK being one of the first countries to get 5G up-and-running at all - Huawei was the primary source of the 4G equipment and its 5G systems were designed to be compatible with 4G to make the upgrade as easy as possible.

Many UK MPs have followed the lead of US President Trump and his recently-found conviction that Huawei is a security risk acting on behalf of the Chinese Government by engineering software ‘back doors’ into the systems that give access to data. This is, as I said,  despite the fact that Huawei has been here for two decades playing a key role in 3G and 4G services. It seems reasonable to suppose that such a capability/practice might have shown itself before now, but no evidence has so far been laid on the table to that effect. It is also a technology that the USA already exploits with its PRISM project, providing access capabilities via US-made telecoms equipment, as revealed by Edward Snowden.

There is a good chance that the pressure applied by Government backbenchers and the US Administration may well lead to Huawei being banned from being used in a 5G network. And because that could well be the case, it is important that CIOs of any business contemplating 5G use in the near or more distant future consider the complications and business impacts that are likely to follow.

Think twice now about early adopting

I’d suggest that early adopters should already be making contingency business plans. Technically the issue would be to fall back to what are the current services – or just stop the plan to move. The immediate expense there may not be too arduous, but any early investment plans underway for systems and services that will exploit 5G once in place may have to be mothballed, stalled, and in some cases written off.

Why? As noted above, Huawei, already having taken much of the 4G market, is able to piggyback off and exploit those existing systems to start getting 5G services available. Other 5G equipment providers will not be able to do the same ,for they are not directly compatible with the existing Huawei kit. This would mean a significant and time-consuming re-jig for every mobile network services provider. One of the biggest, Vodafone UK, has already gone on record  saying that it – and the other service providers - will be obliged to rip out Huawei kit and re-start the mplementation process from the ground up using equipment from another vendor.

This would mean a probable delay of up to 2 years in having any 5G service available at all, at a time when the COVID-19 pandemic has created a seismic shift in working practices. Until recently, employers wanted staff on-site, where they could be seen, but now the pandemic-induced need for remote home working capabilities has rapidly become a must have. This has worked in the main, despite current 4G services being remarkably patchy in both service levels a geographic availability. The one thing future home workers will demand is the right to then decide where they live and that the choice is based on a number of  factors, including bandwidth availability. This is one of the 5G promises.

The coming two years could see, according to research undertaken by Assembly Research, losses in both direct costs and lost revenue opportunities of between £4.5 bilion and £6.8 billion to the UK economy over the period, based on the Government’s own figures. Such losses would be likely to continue for a long time: indeed, the losses are likely to be unrecoverable.

The potential strength of the UK in 5G and AI  leadership is dependent on the country maintaining its current lead in a global marketplace.  Cancelling Huawei as a supplier will also cancel that lead. Indeed, because it will also require a major redesign and re-engineering of the whole network, the chances are that the UK would be well behind the curve, with all the global players looking to exploit 5G inevitably rejigging investment plans and locations.

In short, on top of the economic impact of the pandemic and the economic impact of Brexit, the UK would have to suffer the economic impact of becoming one of many also-rans in the exploitation of 5G, which in turn will impact the potential benefits that would be expected to come from that potent combination of analytics, AI, IoT, edge computing and the Cloud.

Sound like a plan?