Earlier this month, we told you that the Trump administration had painted itself into a corner by banning Huawei, the world's largest network equipment company, from supplying equipment to US carriers. The problem is that US technology companies do not offer the necessary technology to help US wireless operators develop 5G networks. And Huawei's competitors, like Nokia and Ericsson, are more expensive. US officials tried to get domestic tech companies like Cisco and Oracle to produce this equipment, but both denied that they said it would take too much time and money for them to enter this business.
In addition to the products being banned in the United States, Huawei cannot access the US $ 1
1 billion supply chain last year. This is all because US lawmakers consider Huawei to be a security threat to the country because of a law in China. Under this law, the communist regime may require Huawei to gather intelligence on US companies and consumers and send it back to Beijing. As a result, there are fears that Huawei's products – both phones and network equipment – contain a backdoor that could be used as a conduit for this intelligence. Of course, Huawei has repeatedly denied this claim.
Reuters reported Friday that, in a surprising move, Huawei is engaged in talks with some US telecom companies about licensing them 5G network technology. Without naming the US companies involved in these talks, Huawei's senior director and board member Vincent Pang said the talks included discussions on both long-term and one-time licenses. Such one-off transactions were first discussed by Huawei founder and CEO Ren Zhengfei when the executive spoke last month with The New York Times and The Economist . At that time, it was unknown whether any US companies would be interested in a one-time licensing agreement.
Huawei's Pang would not guess whether a pact would be made between his company and some of the anonymous US carriers. But he warned the US companies interested in a one-off licensing agreement that the cost of continuously improving the technology is expensive. For example, it took Huawei billions of dollars since 2009 to develop their 5G network equipment.
The United States has warned its allies not to use Huawei equipment in their 5G network
A Foreign Ministry official was not optimistic that a licensing agreement would be agreed by US carriers. "It's just not realistic for carriers to take on this equipment and then manage all the software and hardware itself," he said. He pointed out that even if the software code is transmitted to the carriers by Huawei, software errors can escape the detection of the wireless providers and can be activated at any time. We believe this official will be cowardly; with "bugs", he could mean technology designed to send intelligence to Beijing.
Huawei is alleged to be in talks about licensing its 5G technology to US Companies
5G is the next generation in wireless connectivity and is 10 times faster than 4G LTE. Not only will these faster data rates allow users to download movies in seconds, but it will also create new businesses and industries in the same way that 4G LTE helped create the rideshare industry. The latter now has two multibillion companies (Lyft and Uber). Countries completing the construction of their 5G networks first will have first dips when participating in the upcoming economic boom boom.
Interestingly, the Trump administration has warned its allies not to use Huawei's equipment in their 5G network. While a few countries like Japan and Australia follow that warning, most of Europe plans to stick to Huawei. The US carriers licensing Huawei's 5G technology should be able to detect something out of place as a back door. Therefore, the US government allows these licensing agreements to take place.