ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Exploring the 5G Saga

Is the USs ban on Huawei a strategy of market competition or state control of digital spaces?

 

After 40 years of economic integration, the United States (US) and China, under their current political regimes have reached a tipping point of economic tensions where both countries remain non-committal towards any kind of forbearance. In fact, political leaders from both countries are advocating for disintegration across all four baskets of goods, capital, people and technology. The disintegration of goods comes undue on the global supply chains, particularly the development of sensitive technologies. The integration of cross-border capital flows is threatened by restrictions on Chinese investments taking hold across big sectors of the US economy. While the integration of people—especially young Chinese students—can be stalled by the US’s potential policy of barring them from a gamut of science and engineering courses in the US. With such trends emanating, the integration of the global innovation ecosystem is at risk with the mutual efforts of the US and China to exclude each other. The recent embargo/moratorium on the Chinese telecom giant Huawei by the US and its allies—especially those in the Five Eyes alliances—is indicative of such technological disintegration.

Starting as a mere reseller of telephone switching gears—imported from Hong Kong—in 1987, Huawei has emerged as one of the leading global suppliers of high-tech network building kits for mobile phones since the late 1990s, along with Nokia and Ericsson. But more importantly, the firm is noted for its proactivity in setting the technical standards for the “fifth generation” (5G) network, wherein China alone is projected to deploy almost 33% of all 5G connections, world-wide, by 2025. In contrast, the share of the US and Western Europe, taken together, is estimated to be around 25% or so. What does this mean? China, and Huawei’s technologies in situ—with 10% of the 53,345 technology patents filed by China in 2018 coming from the firm alone—will be at the heart of those technologies that the governments worldwide have recognised as critical for the future of national infrastructure. According to Deloitte, between 2015 and 2018, China has not only outnumbered the US cell sites by at least 12 times but also outspent it by $24 billion in 5G infrastructure.

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Updated On : 19th Jun, 2019

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