Inside China Tech: Huawei faces shaky prospects in Europe after Britain’s 5G ban

All existing equipment supplied by Huawei to mobile network operators in Britain will be phased out by 2027
That may put pressure on other European governments, including Germany, as they prepare to make similar decisions over their 5G infrastructure roll-out

China technology

Bien Perez

Published: 5:00am, 18 Jul, 2020

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Hello, This is Bien Perez from the SCMP’s Technology desk, with a wrap of our leading stories this week.

Huawei Technologies, the world’s largest telecommunications equipment vendor, faces shaky prospects across Europe’s vast 5G market after the British government banned the company’s gear from its next-generation mobile infrastructure.

Britain’s move focuses attention on Germany, where pressure is growing in the legislature to act against Huawei, according to James Lewis, director of the technology policy programme at the Centre for Strategic & International Studies in Washington.

Under Britain’s new 5G roll-out plan, the country’s mobile network operators will not be able to buy any new Huawei equipment for their 5G infrastructure after the end of this year. All existing equipment supplied by the Shenzhen-based company will be removed from Britain’s 5G infrastructure by 2027.

It overturned London’s decision in January to allow Huawei up to a 35 per cent share in the non-sensitive parts of Britain’s 5G mobile networks, which was made amid the Trump administration’s pressure to block Huawei in major telecoms markets.

02:27

UK bans Huawei from 5G network after US sanctions

That may put pressure on other European governments, including Germany, as they prepare to make similar decisions over their deployment of 5G – the next-generation mobile technology that will help power advances such as the industrial internet, autonomous driving and smart cities.

Huawei said the move by the British government was “bad news for anyone in the UK with a mobile phone” and threatened to “move Britain into the digital slow lane, push up bills and deepen the digital divide”.

Huawei said it is disappointed by the ban and called on ministers to reconsider. “UK revenues are less than 1 per cent of Huawei’s global revenues,” executive vice-president Jeremy Thompson told Bloomberg TV. But he added that “ UK decisions tend to have a wider impact than just the geography bound by the UK”.

Deutsche Telekom, Huawei’s largest customer in Europe, has argued against any blanket bans on individual foreign equipment vendors.

Initially, the British government’s decision has put a question mark on Huawei’s investments in the country. The company last month received approval to break ground on a 1 billion pound (US$1.2 billion) research and development site near Cambridge in the east of England.

Huawei earlier this week reported a 13.1 per cent revenue growth in the first half of this year, despite the global coronavirus pandemic and ongoing sanctions from the US.

TikTok, the widely popular short video app owned by ByteDance, continues to face regulatory troubles in major markets like India and the US. Photo: Reuters

TikTok slapped with fine by South Korea

ByteDance-owned TikTok has been slapped with a fine by South Korea’s telecommunications authority for mishandling data of its underage users in the country, which marks the latest run-in with regulators by the popular short video app after disputes in India and the US.

The Korea Communications Commission (KCC) on Wednesday imposed a 186 million won (US$155,000) fine on TikTok for collecting personal information of users under the age of 14 without parental consent and not notifying users about transferring their data to servers overseas, the regulator said on its website.

TikTok illegally collected 6,000 pieces of user data and transferred its users’ information in Korea to servers in Singapore and the US, according to a report by the Yonhap News Agency, which cited the KCC.

01:04

Pompeo says US considering ban on TikTok and other Chinese apps, praises Google, Facebook, Twitter

While TikTok has become one of the most heavily downloaded apps worldwide since it was launched outside China in 2017, its rapid growth had been marred by subsequent regulatory issues in Indonesia, the US and India.

Earlier this month, American Secretary of State Mike Pompeo said the US was considering taking action against Chinese social media apps, such as TikTok, over privacy issues and potential national security risks amid rising tensions between Washington and Beijing.

While TikTok’s fate in the US is undecided, the news set off a wave of worries among its devoted user base, who are coming up with backup plans on other services.

India’s Ministry of Electronics and Information Technology late in June issued an interim order banning TikTok and 58 other popular Chinese apps over security concerns, weeks after a deadly Himalayan border clash between troops of the two countries.

The icon of Tencent Holdings’ super app, WeChat, is seen on a smartphone screen. Photo: Shutterstock

WeChat users in the US fear disruption as potential ban looms

The US government’s potential ban of WeChat would be a major blow to millions of people in America who rely on Tencent Holding’s popular social media app to stay in touch with friends, family and business contacts in China, according to a report by Abacus producer Xinmei Shen.

Concerns from that community of users in the US have increased amid news that the Trump administration will take “strong action” on WeChat and other Chinese apps.

White House adviser Peter Navarro said he expects President Donald Trump to take such action against WeChat, TikTok and other Chinese-owned social media apps for engaging in “information warfare” against the US, he said on Fox News on Sunday.

College Daily, a popular online publication that operates in Beijing and New York targeting Chinese students in North America, said a ban would have an impact on its operations that is hard to predict. This publication has more than 1.6 million followers on WeChat.

During the 2018–2019 school year, there were more than 369,500 Chinese students studying abroad in the US, according to the Institute of International Education.

The problem for the Chinese diaspora is that many popular social networks and chat apps are banned in China. Facebook, WhatsApp, Telegram and just about anything from Google are all unavailable in the country. Instead of relying on their contacts to use a virtual private network and get around China’s Great Firewall, many of these US users just adopted WeChat.

Tencent declined to comment for this story.

And that is all for this week. Until next time.

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