Huawei Founder offers to license 5G technology to foreign companies
September 17, 2019 Category IT & Telecom, Weekly
Huawei Founder and CEO Ren Zhengfei has offered to license the company’s 5G technology to foreign companies, including patents, licenses, code, technical blueprints and production know-how for a one-time fee, according to a two-hour interview with The Economist. The acquirer would be allowed to modify the source code, meaning that neither Huawei nor the Chinese government would even have hypothetical control of any telecom infrastructure built using equipment produced by the new company. Huawei would likewise be free to develop its technology in whatever direction it pleases.
Ren’s stated aim is to create a rival that could compete in 5G with Huawei to help level the playing field at a time when many in the West are worried that Huawei equipment could be used for spying by the Chinese government. “A balanced distribution of interests is conducive to Huawei’s survival,” Ren said. The U.S. has put Huawei on its Entity List, prohibiting U.S. companies from selling goods and services to Huawei, but has also granted a 90-day reprieve twice. Google has been lobbying the Trump administration to allow it to resume supplying Huawei, and the U.S. Commerce Department has received more than 130 applications from companies for licenses to sell U.S. goods to Huawei. The Trump administration, however, has not yet granted any such license since the latest Huawei reprieve was announced. Despite these challenges, the Shenzhen-based company saw its global share of the telecom equipment market expand to 28.1% in the first half of this year, and it also remains ahead in the 5G equipment market with 50 announced commercial 5G mobile network deals.
UK Defense Secretary Ben Wallace has said China needs to modify its cyber-behavior and adopt a code of “fair play” if Beijing wants the British government to allow Huawei technology to be used in future 5G mobile networks. He added that a long-awaited decision on allowing Huawei to supply equipment to Great Britain’s 5G network is coming soon, without giving a firm date. The U.S. is demanding that Huawei equipment is not used by its allies, while China has warned that not using Huawei as a supplier would delay the rollout of 5G in the UK. Liu Xiaoming, Chinese Ambassador to the UK, said Britain would “lag a year and a half behind”, and that dropping Huawei would “send a bad message to Chinese business”, the South China Morning Post reports.
In Shanghai, the world’s first 5G application exhibition and innovation center was launched at the North Bund waterfront. The 5G International Innovation Harbor has an exhibition hall displaying the most updated applications based on 5G, along with innovation platforms for global enterprises to join the development. Leading Chinese technology companies, including Huawei, ZiFiSense and Lora, display their technologies, facilities, products and scenarios based on 5G. A futuristic outlook at 6G technology, or 5G plus low earth orbit mobile-satellite communications, is also showcased. Shanghai has become one of the leading Chinese cities on 5G development after major carriers China Mobile, China Unicom and China Telecom debuted their 5G networks in the city in June. The city had over 8,800 large 5G outdoor base stations and nearly 6,000 small indoor stations to cover 598 buildings citywide by the end of August.
China Unicom and China Telecom, the second and the third largest Chinese telecom operators, announced that they plan to cooperate in building and sharing 5G network infrastructure in 15 cities, including Beijing, Tianjin, Shanghai and Nanjing. If they now build one instead of two networks, this could have a negative impact on telecom suppliers such as Huawei and ZTE. But China Unicom and China Telecom will also build 5G networks independently in other provinces. China International Capital Corp said that the partnership between the two telecom companies will significantly relieve the financial pressure on both companies. Currently, China Mobile, the country’s largest telecom operator, has as many 4G base stations as China Unicom and China Telecom combined. Last year, the China Academy of Information and Communications Technology forecast that the country’s telecom carriers are expected to spend CNY900 billion to CNY1.5 trillion on 5G network construction from 2020 to 2025.
Smartphone shipments in China fell 6% to 97.9 million units in the second quarter, down from 104.2 million units a year earlier, according to research firm IDC. The appearance of 5G handsets on the market may give a new impulse. Huawei will started selling its Mate 20 X 5G smartphone in the country on August 16, priced at CNY6,199. Pre-orders of the handset exceeded 1 million. The Axon 10 Pro 5G smartphone from ZTE Corp and Samsung’s Galaxy S10 have also been released in China. Vivo is expected to launch its own 5G handset in Shanghai this week, while Beijing-based Xiaomi will follow soon.
Apple’s newly released iPhone 11 series does still not support 5G and could therefore lose out in the competition. Globally, iPhone sales fell 12% to USD25.99 billion in the quarter to June 30, after dropping 17% in the previous quarter. In July, Apple reported total sales of USD9.61 billion in the same period from Greater China – covering mainland China, Hong Kong and Taiwan – 4% down from a year earlier.
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