By Khalid Athar
The roll-out of nex-generation 5G wireless networks can be a real game-changer and one in which some Middle Eastern countries are currently leading. But, to make this happen, openness, transparency, close collaboration, and providing fair opportunities to all is vital.
With 5G’s expected significant influence and transformational capabilities, governments play a key role in improving the productivity, participation, and creativity of societies and businesses; and are thus well suited to dictate the application of digital-economy strategies by taking advantage of advanced technologies, 5G specifically.
In this context, one of the most significant issues in the world of digitization, technology and 5G, is the United States ban on Huawei technologies and solutions, and what that means for businesses and consumers in the Middle East and around the world.
As a private company, Huawei is a true representative of cutting-edge technology and innovation, reaching out to the world with advanced technologies and solutions, particularly in 5G, AI and computing. As the digital era evolves and the world’s continuous need for new technologies regardless of its origin country, the blacklisting of Huawei by the US is an event of historic significance.
Since 2019, the US administration added Huawei to an “entity list” that barred many US companies from engaging with Huawei, and has since tried to pressure its allies to not engage Huawei on 5G network developments. The current US policies essentially limit Huawei from procuring necessary components for its 5G division, as well as its broader advanced technology portfolio.
The premise of these policies has always been “national security”, and that Huawei posed a security threat. However, it is becoming increasingly clear that the US administration’s policies are less about security and more about Western dominance in emerging technologies like 5G.
The US is not doing enough to maintain American strength
The reality is that, for the first time in history, the US is not leading the next technological era.
Earlier this year, US Secretary of State Michael Pompeo went so far as to say that Europe “needs to get” Huawei “out of their system” as part of ensuring “that the next century remains a Western one.” US Attorney General William Barr was quoted as saying that some private American businesses are actually the “problem” for not doing enough to maintain American strength.
The reality is that, for the first time in history, the US is not leading the next technological era. This is happening by companies in China, and many other brands from the East. Technology—and particularly 5G networks—have become especially important in the context of COVID-19, with an ability to support huge surges in network traffic connecting people and machines more than ever before. While the US has no national company competing in 5G, it still has great power to enforce economic sanctions, which is what they are doing now until they can figure out how to catch up.
This is important for the Middle East as aggressive actions against 5G technology supply chains harm all economies. Today we are interdependent as a region and as a global society. We rely on each other and on digital infrastructure to keep borders open, trade flowing, and to share knowledge.
Internet Society Statement
Following US Secretary of State Michael Pompeo’s announcement on launching the “Clean Network” Program and the United States’ efforts to remove Chinese companies from the internet in the US, the Internet Society Statement said.
“The Internet is a global network of networks, where networks interconnect on a voluntary basis with no central authority. It is this architecture that has made the Internet so successful. Today’s announcement of the U.S. Clean Network program challenges this architecture at its very core.
SEMI
SEMI, the industry association serving the global electronics design and manufacturing supply chain, issued a statement as response to the new export control rule changes announcement by the United States Commerce Department which banned US companies, or any other company in the world to export equipment with US technologies to Chinese companies, particularly Huawei.
On July 14 2020, in public comments on the May 15 regulations, SEMI cautioned that those relatively narrow actions created unique disincentives to purchase U.S.-origin semiconductor equipment and design software and had already resulted in $17 million lost sales of U.S-origin items to firms unrelated to Huawei.
Huawei 5G Passes GSMA’s NESAS
In August 2020, Huawei’s 5G wireless and core network equipment surprised the world by passing the GSMA’s Network Equipment Security Assurance Scheme (NESAS), which is an implicit response to many of the allegations that the US administration made against Huawei about the security of 5G networks.
Cybersecurity assurance is a shared goal
For Huawei, cybersecurity assurance is a shared goal between Huawei, customers, supervisory authorities, and other stakeholders. Trust in cybersecurity has become a major global concern as the world becomes more digital. Huawei believes that trust must be based on verifiable facts, which should in turn be based on shared standards. We believe that this is an effective way to build trust in the digital era. Huawei supports GSMA and 3GPP in developing a global standardized security assessment, an idea that has largely been accepted as an industry consensus. NESAS promotes this concept, and as such, Huawei urges the industry to widely adopt NESAS.
The summary independent audit reports of the NESAS assessment can be found at https://www.gsma.com/security/nesas-participating-vendors/
US Eases Conditions
To protect the interest of American companies, the United States (U.S.) announced that it has eased earlier sanctions imposed on Huawei in mid-2020 which banned the company from using American technologies in 5G networks and semi-conductors. The Department of Commerce approved in a statement a new rule that allows U.S. companies to work with Huawei on setting standards for next generation 5G networks.
Experts believe that the U.S. government aims, through the new decision, to keep American companies capable of competing with Huawei, but its previous sanctions have unintentionally caused U.S. companies to lose their position in favor of Huawei.
Industry experts confirm that the decisions by the US government does not just affect Huawei. It will have a serious impact on a wide number of global industries. In the long run, this will damage the trust and collaboration within the global semiconductor industry which many industries depend on, increasing conflict and loss within these industries.
Sources:
https://www.ft.com/content/a669d094-bc68-40fc-9d05-9c4d369d32ee
Statement on Foreign Direct Product Rule Changes
Huawei categorically opposed the amendments made by the US Department of Commerce to its foreign direct product rule that target Huawei specifically.
Huawei is undertaking a comprehensive examination of the new rule and expects that its business will inevitably be affected and it will try its best to seek a solution.
China was the biggest source of applications for international patents in the world last year, pushing the United States out of the top spot it has held since the global system was set up more than 40 years ago, the U.N. patent agency said. According to the WIPO data, China’s Huawei Technologies, the world’s biggest maker of telecoms equipment, was the top corporate patent filer for the third consecutive year.
According to the WIPO data, China’s Huawei Technologies, the world’s biggest maker of telecoms equipment, was the top corporate patent filer for the third consecutive year in 2019. The company was able to stay in the lead despite the US campaign that enlisted Huawei in their ‘black list’ and continued to convince its allies not to use the company’s equipment based on a series of allegations and accusations on information security without any evidence.
Huawei is one of the largest patent holders in the world. As of December 31, 2019, the number of active patents held by Huawei exceeded 85,000. The active patents granted in China were 30,000+, and the active patents granted outside China were 50,000+. Of those, active patents granted in Europe and the US were 40,000+.
References:
EU Ranks Huawei Among Top 3 Global Innovators
Huawei ranks third in the 2020 EU Industrial R&D Investment Scoreboard. This is a jump of two places for Huawei compared to last year when the company ranked 5th in the 2019 EU Industrial R&D Investment Scoreboard.
The 2020 EU Industrial R&D Investment Scoreboard is a European Commission publication. It ranks the research investment levels of 2500 companies around the world that comprise 90% of the world’s business-funded R&D. The report was prepared by the EU Joint Research Centre (JRC).
Abraham Liu, Huawei’s Chief Representative to the EU Institutions: “The EU confirms that Huawei is now among the top three innovative global companies. To maintain the European way of life for its future generations, Europe will need to use the best technologies and innovations. Huawei stands ready to team up with Europe for a joint bright future,” said Abraham Liu, Huawei’s Chief Representative to the EU Institutions.
Much of the global research that Huawei carries out takes place in Europe. Huawei set up its first research centre in Sweden in the year 2000. Today, through a series of partnerships with over 150 European universities, Huawei is deeply embedded within the ICT research ecosystem in Europe. Through this collaborative research activity, Huawei makes Europe fit for the digital age.
Source:
https://www.eureporter.co/eu-2/2020/12/18/eu-ranks-huawei-among-top-three-global-innovators/
European Patent Office report
By the end of Q1 2020, a report by the European Patent Office said that Huawei filed more patent applications in Europe than any other company last year, pioneering the development of solutions to support digital transformation worldwide.
Of its patent applications, around two thirds of those were in the field of digital communications, including the development of 5G technology. Huawei has already been leading 5G expansion globally, now focusing on vertical industry, ecosystem, and 5G talent development in 2020 including AI, computing and big data. This also includes on building an ICT ecosystem in countries the company is operating in and aims to develop talents in 5G technologies in the year 2020.
Huawei filed 3,524 patent applications in total, far more than the next highest company, and by far the largest filer of digital communications patents. The report noted that US, Chinese and European companies each contributed about a quarter of all applications in digital communications. Applications by Chinese firms have risen nearly six-fold since 2010.
EU Commission issues “5G toolbox”, allowing Huawei in 5G rollout
At the start of 2020, the European Union issued a set of guidelines, referred to as the “5G toolbox”, and allowed Huawei to continue participating in Europe’s 5G roll.
The guidance comes just a day after the British government officially approved Huawei’s involvement in 5G networks in the United Kingdom following the National Security Council meeting headed by Prime Minister Boris Johnson, which announced allowing Huawei to continue developing 5G networks in Britain.
In a Huawei media statement following the publication of the European Commission’s 5G toolbox, Abraham Liu, Huawei Chief Representative to the EU Institutions, commented: “Huawei welcomes Europe’s decision, which enables Huawei to continue participating in Europe’s 5G roll-out. This non-biased and fact-based approach towards 5G security allows Europe to have a more secure and faster 5G network.
Huawei Founder and CEO Downplayed the US Ban at Davos 2020
At the start of 2020, and with the escalation of the United States’ campaign against Huawei, Huawei founder and CEO Ren Zhengfei said during a panel discussion held at the annual meeting of the World Economic Forum in Davos that the company has withstood the challenges posed by a US entity list ban last year, emerging as a stronger organization and one committed to international cooperation, thanks to Huawei’s employees and their efforts in R&D which resulted on many alternatives, thus led to the continued trust of customers and a stable business despite all the obstacles.
Mr. Zhengfei said his company has “basically stood the challenges” posed by the current US administration in 2019, including being placed on an export blacklist and targeted on various fronts. “The US might further escalate their campaign against Huawei, but I feel the impact against Huawei would not be very significant,” he said. “I am confident we can survive future attacks.”
He added that Huawei has spent billions to prepare a “plan B,” which has allowed the company to survive the US entity ban. “This year in 2020, since we already gained experience from last year and we got a stronger team, I think we are more confident that we can survive even further attacks,” he added. The Founder strongly beieves that the world can avoid splitting into two global systems, and does not believe further escalation in technology will lead to two different systems controlled by different global powers.
Speaking at Davos, the CEO also made note of his respect for American companies and championed international cooperation. “Huawei used to be an admirer of the US, we learned a lot from them. We hired dozens of American consulting firms to learn how to manage our business. The US should feel proud of [Huawei], they have the US management system exported and implemented. They should not be overly concerned about Huawei and our position in the world.”
Huawei Announces Q3 2020 Business Results
Huawei has announced its business results for the first three quarters of 2020. During this period, Huawei generated USD98.57 billion in revenue, an increase of 9.9% over the same period last year. The company’s net profit margin in this period was 8.0%.[1] Throughout the first three quarters of 2020, Huawei’s business results basically met expectations.
As the world grapples with COVID-19, Huawei’s global supply chain is being put under intense pressure and its production and operations face significant challenges. The company continues to do its best to find solutions, survive and forge forward, and fulfill its obligations to customers and suppliers.
Moving forward, Huawei will leverage its strengths in ICT technologies such as AI, cloud, 5G, and computing to provide scenario-based solutions, develop industry applications, and unleash the value of 5G networks along with its partners. Its stated goal is to help enterprises grow their business and help governments boost domestic industry, benefit constituents, and improve overall governance.
ICT has become a cornerstone of modern society and the main driver behind sustainable social, economic, and environmental development. Huawei believes that rapid and healthy development within the ICT industry will rely on open collaboration and mutual trust across the global industry, so it will continue working closely with its global partners and using its innovative ICT technologies to create greater value for customers despite the complex situation it is currently facing. The company will continue contributing to pandemic responses, economic growth, and social progress.
