Trump and Huawei exert opposing pressures on US allies’ 5G telecom investments

Mike Pompeo warns US allies on Huawei links

THE WEEK IN 5G – The ding dong battle over the acceptability, or otherwise, of Huawei’s involvement in national 5G infrastructure projects is intensifying, says Jeremy Cowan.

Security concerns have led to reservations about (or blanket rejections of) Huawei’s involvement in critical infrastructure. Grave concerns have now been expressed by countries including the USA and Australia. While a more emollient tone is now coming from the UK, Italy, New Zealand and Turkey – with Germany still sitting on the fence.

US Secretary of State, Mike Pompeo has warned allies not to deploy the Chinese telecom giant’s equipment in their national infrastructures,  saying, “If that equipment is co-located where we have important American systems, it makes it more difficult for us to partner alongside them.”

Opinion is divided in financial and technology circles on whether this roadblock for Huawei is good news for rivals such as Ericsson (NASDAQ: ERIC) and Nokia (NYSE: NOK). With Huawei’s reputation no longer founded so heavily on lower pricing there may be an upside for rivals, who have remained remarkably silent.

Not so, the financial analysts where other factors are at play. Moody’s, for example, changed the outlook on Nokia to negative from stable on February 8th. Alejandro Núñez, Moody’s lead analyst for Nokia said that this, “reflects our expectation that a slower than previously anticipated improvement in the company’s revenue growth, operating profit and cash flow trends (including restructuring charges) in 2019 will not be sufficient to strengthen Nokia’s key credit metrics to levels expected for the current ratings.” However, private investors were mainly of the view that Nokia remains a good long-term investment.

This week saw a break in the West’s ranks, with UK security chiefs from GCHQ saying they continue to scrutinise Huawei’s 5G systems but have found no backdoor that would prevent Britain working with the world’s biggest provider of telecoms equipment.

Huawei dangles carrot of UK investment

Finding a more nuanced response from the UK, Huawei has been quick to “restate its support for the United Kingdom as a key area for investment and future growth in the company’s activities”.

Speaking to the BBC, Huawei’s founder, Ren Zhengfei (pictured below) said: “We will continue to invest in the UK. We still trust in the UK. If the US doesn’t trust us, then we will shift our investment from the US to the UK on an even bigger scale.”

Huawei’s Ren Zhengfei: “If the US doesn’t trust us we will shift our investment … to the UK on an even bigger scale.”

Since first setting up operations in Britain 18 years ago, Huawei has become a large inward investor in the country, employing around 1,500 people directly (more than 1,000 of whom are locally recruited) and supporting another 7,500 jobs through its supply chain. Up to the end of 2017, the company had invested and procured £2 billion (€2.3 billion) in the UK and says it plans to spend another £3 billion (€3.45 billion) with British suppliers over the next five years.

For the last five years, the company has funded a centre overseen by GCHQ that provides the UK’s security services with what it terms “complete access” to Huawei technology. “No other technology supplier in the UK is open to this degree of independent scrutiny,” added the Chinese vendor.

Amid continued uncertainty over Brexit, Britain’s exit from the EU, and following several high-profile investment losses (think Honda, Dyson, Nissan, Goldman Sachs, etc.) the wish to attract new investment may prove irresistible, even if it damages US/UK relations in the short term.

The author is Jeremy Cowan, editorial director of IoT Now and VanillaPlus.

Comment on this article below or via Twitter: @IoTNow_OR @jcIoTnow

RECENT ARTICLES

Nordic-powered smart utility access cover offers anti-theft protection and detects open/close events

Posted on: August 16, 2022

Oslo, Norway – China-based Jian-IOT has launched a smart utility access cover that can detect when the cover has been opened or closed, records water level and temperature data, identifies any damage, and includes an anti-theft system that tracks the current location of the device. The ‘Integrated Intelligent Manhole Cover’ employs Nordic’s nRF52832 SoC to both act

Read more

Helbiz to offer on-demand taxi services to widen international intermodal offering

Posted on: August 16, 2022

New York, United States – Helbiz, a global provider in micro-mobility, announced the beginning of a new chapter for its intermodal mobility offering, Helbiz Taxi. The micro-mobility company aims to integrate mobility services around the world in its app to widen the intra and extra urban mobility offerings to include vehicles from additional companies with

Read more
FEATURED IoT STORIES

9 IoT applications that will change everything

Posted on: September 1, 2021

Whether you are a future-minded CEO, tech-driven CEO or IT leader, you’ve come across the term IoT before. It’s often used alongside superlatives regarding how it will revolutionize the way you work, play, and live. But is it just another buzzword, or is it the as-promised technological holy grail? The truth is that Internet of

Read more

Which IoT Platform 2021? IoT Now Enterprise Buyers’ Guide

Posted on: August 30, 2021

There are several different parts in a complete IoT solution, all of which must work together to get the result needed, write IoT Now Enterprise Buyers’ Guide – Which IoT Platform 2021? authors Robin Duke-Woolley, the CEO and Bill Ingle, a senior analyst, at Beecham Research. Figure 1 shows these parts and, although not all

Read more

CAT-M1 vs NB-IoT – examining the real differences

Posted on: June 21, 2021

As industry players look to provide the next generation of IoT connectivity, two different standards have emerged under release 13 of 3GPP – CAT-M1 and NB-IoT.

Read more

IoT and home automation: What does the future hold?

Posted on: June 10, 2020

Once a dream, home automation using iot is slowly but steadily becoming a part of daily lives around the world. In fact, it is believed that the global market for smart home automation will reach $40 billion by 2020.

Read more

5 challenges still facing the Internet of Things

Posted on: June 3, 2020

The Internet of Things (IoT) has quickly become a huge part of how people live, communicate and do business. All around the world, web-enabled devices are turning our world into a more switched-on place to live.

Read more

What is IoT?

Posted on: July 7, 2019

What is IoT Data as a new oil IoT connectivity What is IoT video So what’s IoT? The phrase ‘Internet of Things’ (IoT) is officially everywhere. It constantly shows up in my Google news feed, the weekend tech supplements are waxing lyrical about it and the volume of marketing emails I receive advertising ‘smart, connected

Read more
IoT Newsletter

Join the IoT Now online community for FREE, to receive: Exclusive offers for entry to all the IoT events that matter, round the world

Free access to a huge selection of the latest IoT analyst reports and industry whitepapers

The latest IoT news, as it breaks, to your inbox