Relations between Chinese tech giant Huawei and the U.S. are quite complicated. However, the U.S. is not the only country that decided to take measures against the tech giant. For example, the U.K.’s government decided to ban the installation of new Huawei 5G equipment from September 2021.
The government plans to remove the Chinese firm’s technology by 2027. As a reminder, several months ago the government made an important announcement. According to this announcement, telecoms operators will not be allowed to buy new 5G telecoms equipment from Huawei from January of 2021.
It is worth noting that this announcement means that any telecoms companies which stockpiled Huawei equipment, will now not be able to use the equipment for long-term 5G rollouts. In fact, some companies started to prepare for the deadline by stockpiling equipment produced by Huawei. However, firms will be able to maintain old equipment after September.
Based on the information in the nearest future the parliament will start the process of enshrining the ban into law. Importantly, under the Telecommunications Security Bill, telecoms companies could face up to 10% of turnover or £100,000 per day, if they fail to comply with new security standards.
Huawei and legal constraints
Interestingly, competitors Ericsson and so far picked up several of the contracts to replace Huawei’s equipment. It is worth noting that the government is promising to invest £250 million to encourage the growth of smaller players in the industry. Importantly, this initiative will try to reduce the impact of removing the tech giant’s equipment from 5G networks.
Moreover, the initiative includes the creation of a new National Telecoms Lab and investing in new open radio technology.
People should take into account that, in the past, Huawei consistently denied posing a national security risk. The company’s vice-president Victor Zhang, connected U.K.’s decision to ban its equipment to politics.
Companies around the world are working hard to introduce 5G technology. Companies that operated in the U.K. will have to replace the equipment produced by Huawei in several years. It means they will have to spend a lot of money to replace the equipment. It won’t be easy to find a company that is willing to offer the same prices as Huawei.
Nevertheless, they have to find another company or companies that will replace the tech giant in the future. Hopefully, the government is promising to invest £250 million. This way the government wants to help small players to strengthen their positions.