Huawei reportedly in talks to license its 5G networking technology to U.S. carriers

Huawei reportedly in talks to license its 5G networking technology to U.S. carriers
Earlier this month, we told you that the Trump administration had painted itself into a corner by banning Huawei, the world's largest networking equipment company, from providing gear to U.S. carriers. The problem is that U.S. tech companies don't offer the necessary technology to help American wireless operators build out their 5G networks. And Huawei's competitors, like Nokia and Ericsson, are more expensive. U.S. officials tried to get domestic tech firms like Cisco and Oracle to produce this equipment, but both declined stating that it would take too much time and money for them to enter this business.

Besides having its products banned in the U.S., Huawei cannot access the American supply chain it spent $11 billion on last year. It is all because U.S. lawmakers consider Huawei to be a security threat to the country because of a law in China. Under this law, the communist regime can demand that Huawei gather intelligence on American companies and consumers and send it back to Beijing. As a result, there is a fear that Huawei's products-both phones and networking equipment-contain a backdoor that can be used as a conduit for this intelligence. Huawei, of course, has repeatedly denied this allegation.

On Friday, Reuters reported that in a surprising move, Huawei is engaged in conversations with some U.S. telecom firms about licensing to them its 5G networking technology. Without naming the American companies involved in these talks, Huawei's Senior Vice President and board director Vincent Pang said that the conversations included discussions about both long term and one-time licensing deals. 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 the time, it was unknown whether any U.S. firms would be interested in a one-time licensing deal.

Huawei's Pang wouldn't guess whether a pact would be signed between his company and any of the anonymous U.S. carriers. But he did warn those American firms interested in a one-time licensing deal that the cost of continually improving the technology is expensive. For example, it cost Huawei billions of dollars since 2009 to develop its 5G networking equipment.

The U.S. has warned its allies not to use Huawei equipment in their 5G networks


A State Department official was not optimistic that a licensing deal would be agreed to by U.S. carriers. "It’s just not realistic that carriers would take on this equipment and then manage all of the software and hardware themselves," he said. He pointed out that even if the software code is turned over to the carriers by Huawei, bugs in the software might escape detection by the wireless providers and they could be activated at any time. We think that this official is being coy; by "bugs," he could mean technology designed to send intelligence to Beijing.


5G is the next generation in wireless connectivity and is 10 times faster than 4G LTE. Not only will these faster data speeds allow users to download movies in seconds, but it also will lead to the creation of new businesses and industries in the same way that 4G LTE helped create the rideshare industry. The latter now has two multi-billion companies (Lyft and Uber). The countries that complete the construction of their 5G networks first will have first dibs at participating in the upcoming 5G economic boom.

Interestingly enough, the Trump administration has been warning its allies not to use Huawei's equipment in their 5G networks. While a few countries like Japan and Australia heeded that warning, most of Europe plans on sticking with Huawei. The U.S. carriers that license Huawei's 5G technology should be able to detect anything out of place like a backdoor. That is why the U.S. government would allow these licensing deals to take place.

FEATURED VIDEO

15 Comments

1. meanestgenius

Posts: 22388; Member since: May 28, 2014

If this report holds true, it looks like the U.S. has realized the foolish decision it made to ban Huawei equipment and software from U.S. telecoms. If Huawei were really spying for China, would they allow the U.S. telecoms access to the source code where they will be able to detect any backdoors and the like? No. They wouldn't take the risk. As the U.S. still has not provided any evidence of Huawei spying, it's also clear that U.S. companies are putting pressure on the U.S. government to allow them to do business with Huawei. From a business standpoint, it makes total sense for U.S. telecoms to want to continue to do business with Huawei, as they are not only the less expensive option, but they are also the best option for 5G tech and the market leaders. Looks like this BS political propaganda tomfoolery is beginning to come to an end.

3. Fred3

Posts: 574; Member since: Jan 16, 2018

The US didn't want to loose them in the first place. Too many jobs here uses their equipment. It was Trump and his goons that made it a problem

4. meanestgenius

Posts: 22388; Member since: May 28, 2014

Agreed. By "U.S.", I mean U.S. government.

7. Ashoaib

Posts: 3309; Member since: Nov 15, 2013

Huawei won't install backdoors to use for spying. That is the problem for USA. USA want a company which they can control whenever they want to and Huawei is not that one. USA can't just say this obvious fact and refuse to use Huawei. And can't just push other countries to not use Huawei if for actual reason. So US being US, has to create a drama. This is the drama which all of us are seeing against Huawei. Things are not so difficult to understand, until someone don't want to think deeply.

9. meanestgenius

Posts: 22388; Member since: May 28, 2014

Absolutely agree.

13. Venom

Posts: 3778; Member since: Dec 14, 2017

If Huawei wasn't a threat to security, then this wouldn't be a problem. They have been guilty of some crimes in the past.

14. frequency

Posts: 115; Member since: Aug 13, 2013

What about Google, Apple and Facebook in Europe? They were guilty too, but I've never seen you blame them. Double standard?

17. Venom

Posts: 3778; Member since: Dec 14, 2017

What about them? I never once said nor implied that they were innocent. They are already under investigation even though Google is getting extorted illegally by the EU. What more must be said?

15. meanestgenius

Posts: 22388; Member since: May 28, 2014

The U.S. has yet to prove that Huawei poses any threat, as they have not been able to provide any evidence of spying. Meanwhile, Google, Apple, Facebook, and Microsoft have all been proven to have backdoors, spying, etc. Cisco, an American company, has also been proven to have backdoors in their equipment. If there were any merit to Huawei being a threat, the U.S. government would prevent carriers from any type of talks to license Huawei 5G technology, and that is not the case, according to this report.

2. DellB

Posts: 57; Member since: Jun 07, 2015

The US doing everything it can to gain an unfair advantage. When they're ahead of you, just put a ban on them and press the whole world to follow suite. I bet the NSA has forced similar backdoors on US tech.

12. Venom

Posts: 3778; Member since: Dec 14, 2017

How's it any different from China banning goods and services? Don't forget that Chinese law still exists.

11. Venom

Posts: 3778; Member since: Dec 14, 2017

I don't understand how people can cry political propaganda and bash the US for protecting national security when China does the exact same thing and gets a free pass. China has banned many things from other companies, but the US bans Huawei because they are a threat to national security being heavily tied to the Chinese government and it becomes a huge problem. It's not really a fair thing to decry the US for something China has done and another thing, China still has that law as mentioned in the article yet no one seems to acknowledge that fact. Huawei is a threat to national security and to go through with the them for a technology that's still in infancy is ludicrous. 5G right now is nothing more than a pipe dream. There are some people who are STILL stuck on 2G and 3G because LTE doesn't cover them. We can't rush to 5G when we haven't fully implemented 4G and especially when it's a national security threat.

16. meanestgenius

Posts: 22388; Member since: May 28, 2014

Because the U.S. has yet to provide any evidence of wrongdoings from Huawei, that’s why. No one here commenting has given China a free pass about anything, but you sure do seem to be giving the U.S. government a free pass, as well as American companies like Google, Facebook, etc for their backdoors and spying on behalf of the U.S. government. It’s not really fair to decry China for something the U.S. has done. If Huawei is a threat to U.S. national security like you say, post solid proof saying so, as the U.S. themselves has yet to provide any. And don’t post accusations, post solid evidence proving so. 5G is the future, and technology advances at breakneck speeds. Companies and countries either get on board and advance with it, or be left behind. It’s not Huawei’s fault that U.S. companies don’t have the expertise to begin to compete with Huawei in this area, an area where Huawei has yet to proven as a threat to national security. So if they really are, provide proof, or you’re just stating your opinion and not the facts. The facts are greater than ones opinion.

* Some comments have been hidden, because they don't meet the discussions rules.

Latest Stories

This copy is for your personal, non-commercial use only. You can order presentation-ready copies for distribution to your colleagues, clients or customers at https://www.parsintl.com/phonearena or use the Reprints & Permissions tool that appears at the bottom of each web page. Visit https://www.parsintl.com/ for samples and additional information.