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Why should Europe fight the White House’s 5G trade war with China?

Enrique Dans
Enrique Dans
Published in
2 min readNov 24, 2018

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The White House has asked Germany, Italy and Japan to ban the use of equipment manufactured by Huawei when rolling out 5G technology, having already banned the US administration and called on US companies to do the same, as well as having tried to persuade Australia, Canada and South Korea not to work with the Chinese company. In March, the Trump administration used a presidential executive order to block the acquisition of Qualcomm by Broadcom, as part of a strategy to prevent Huawei gaining further dominance over 5G patents.

The problem? Huawei has invested huge amounts in 5G research and development, putting the company at the center of the 5G ecosystem, which means that not using its equipment could likely delay the deployment of one of the technologies that will most influence competitiveness in the coming years, allowing millions of devices to connect to the so-called internet of things, place sensors on infrastructures, objects or vehicles, and enable the development of key technologies such as autonomous driving.

Saying no to Huawei means delays, reduced competitiveness and in all probability, more expensive 5G roll outs. Furthermore, for the moment, nobody has been able to provide proof of the espionage claims and national security risks outlined in a 2012 Congressional report: the supposed evidence, obviously denied by the company, is flimsy. In addition, the company has made clear its intentions to manage its huge portfolio of patents based on FRAND standards, aimed at ensuring fair, reasonable and non-discriminatory agreements.

In other words, it seems that rather than protecting itself against espionage, the US government wants to start a war over the control of the next generation of internet connection, which it sees as strategic. The successive attempts to stymy Huawei can be seen as a way to try to prevent China’s current dominant position regarding 5G technology and its patents from becoming one of total leadership, and is just another front in the trade war the Trump administration has declared against the country, one in which US allies are being used as pawns in which they will suffer delays, become less competitive and potentially end up paying more for one of the technologies that will define the evolution of technology.

(En español, aquí)

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Enrique Dans
Enrique Dans

Professor of Innovation at IE Business School and blogger (in English here and in Spanish at enriquedans.com)