Britain would block Huawei from supplying all core parts of the 5G network and restrict access to non-core parts, Reuters reported.
This will be a big setback to Huawei, the leading telecom equipment vendor in the world. A ban on the core of the 5G network indicates that Britain still does not trust telecom equipment from China’s Huawei.
This will benefit rival telecom equipment makers such as Nokia, Ericsson, Samsung and ZTE. Samsung has already become the leading 5G network supplier in South Korea. This apart, Samsung is already supplying 5G network to telecom operators in the US.
Huawei has already reported a drop in the revenue of its telecom carrier business in the wake of existing restrictions on the supply of telecom network to US-based telecom giants and mobile operators in Europe.
UK’s Digital Minister Margot James tweeted: “In spite of cabinet leaks to the contrary, final decision is yet to be made on managing threats to telecoms infrastructure.”
Margot James later told Sky News that a final decision on 5G security issues had not been made and the government had concluded a review on security issues.
Huawei’s equipment is either not present or is being stripped out of existing core networks in Britain, but is widely used in lower risk parts such as radio masts. Huawei welcomed the development.
BT Group earlier announced that it has already decided against sourcing 5G equipment from Huawei due to security concerns.
Vodafone, the world’s second largest mobile company, has warned a complete ban would significantly extend the cost and time to deploy 5G network. Huawei is one of the major 4G network suppliers in Europe.
The telecoms equipment market is divided between three majors suppliers – Huawei, Ericsson and Nokia – and network operators oppose any reduction that would limit competition among them.
“It’s essential that we get the balance right, ensuring that our networks are built in a way that is secure against interference from whatever source, but also are competitive,” said Britain’s finance minister, Philip Hammond.
“Where our security experts tell us that there are ways in which we can maintain security – whether it’s in networks or installations – that avoid the most economically costly outcomes, then we should look very carefully at those options.”
United States have already blocked both Huawei and ZTE from supplying telecom network to mobile operators such as AT&T, Verizon, T-Mobile, Sprint, among others. There is a fear that blocking Huawei from 5G network would delay the roll out of 5G mobile services in the US.
Britain will allow Huawei Technologies a restricted role in building parts of its 5G network, seeking a middle way in a bitter dispute between the United States and China over the next generation of communications technology.
Huawei, the world’s biggest producer of telecoms equipment, is under intense scrutiny after the United States told allies not to use its technology because of fears it could be a vehicle for Chinese spying. Huawei has categorically denied this.
Britain’s National Security Council, chaired by Prime Minister Theresa May, met to discuss Huawei on Tuesday.
Britain’s compromise could provide a template for other Western nations to follow as they try to navigate the row between Beijing and Washington.
Five Eyes alliance of the US, Britain, Australia, Canada and New Zealand will not use network technology from Huawei in its most sensitive networks.
“What I see playing out here is a discussion amongst all of us about the realities of where do you define sensitive networks, where does that start and end,” said Rob Joyce, a senior official from the U.S. National Security Agency.