Next shutdown, comes Europe. Bullet dodged by Huawei in the UK

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As for what the news says, the building of Britain’s 5G network, Huawei is granted a limited role. With same, the company will be able to maintain its presence in the Crucial market. It will be a success even after US efforts towards reining the growth of the company.

UK government, the decision was announced. The same has implications which are far and beyond the borders of the country. It will set a precedent which will replicate in the market across Europe. Hundreds of millions of people will be affected by the same.

Security critical areas of the network of Britain will exclude the Chinese company. The companies include the list of ones which identify customers or make any kind of decisions as regards traffic routing. But guess the British Mobile operators will still be supplied by same. The mobile operators will include Vodafone (VOD), Three and BT (BTGOF). It will all have less sensitive products like radio technology or even the base stations. It will continue till the market share of same will be limited to 35%.

Huawei’s will face hardships by such decisions in the UK. Some of the other European countries might even take up with some similar routes after the announcement of the plan but the same falls short as of the outright ban which was sought by the Trump administration on Huawei. It seemed like a positive step for the company but in actual 

brought in some major threats along National Security grounds with growth.

At least the company as per Berenberg analyst Usman Ghazi has not to be asked to get out. It will be the worst. Further, the growth of Huawei will be limited with restrictions which were announced by the UK government. As for him, the big money lies in the extensive 5G equipment which is needed to be installed on thousands and thousands of towers and the rooftops and a tap in same can still be made in by Huawei.

How complicated is the environment?

2001, it was long back since Huawei has operated in the UK. It has now made clear that the decisions made are all business significant. Even the Vice president of Huawei reassured that the company will continue to work with the customers therein.

No, the path won’t be easy as there are around 35% of the market cap with the Huawei’s UK customers who are scrambling to have access over the supply chains. There might also a need to make a change of plans.

Although Vodafone UK doesn’t have Huawei in the core, still the potential impact of the decision will be experienced on its non-core network elements. As per Vodafone, the equipment used by the company is a mix of Huawei. Ericsson (Competitors) and also Nokia for masts of 4G and 5G. 

There was also seen that some European mobile operators have been pushing along for the complete freedom to choose the supplier. They are choosing 5G vendors, with a message to have the freedom of choice in same.

Well, this is a counter to Trump administration goals. They are trying to ban the products of Huawei and alleged that the equipment can be used for spying by Beijing. Although the same threat has been denied by Huawei.

What did Europe decide?

The UK has been made a springboard to Europe by Huawei, a major smartphone producer. The same has growth outside China as the most lucrative market and this clearly shows that the decision will be reverberating far and beyond the borders of Britain.

For what we see, the announcement made by the UK is one significant achievement for Huawei. It can use to show to the potential parties that if the UK seems comfortable, why everyone seems to seek out? as per Steve Tsang, the director of SOAS China Institute in London.

As per his noted words, UK is one member of 5 eyes intelligence which shares community and includes States, Australia, Canada and New Zealand. 

The US and Australia have already barred Huawei from participation in 5G and such decisions are still awaited form Canada and Germany. Even the European Commission might weigh-in, making an announcement.

As for the German Chancellor Angela Merkel, she has been very reluctant towards excluding the specific providers from the 5G network of the country and might fall in line with the UK. Seems like the influence of UK is high herein.

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