US official overseeing country’s frequency strategy has resigned

David Redl, heading National Telecommunications and Information Administration (NTIA), responsible for the US’ strategy on frequency and 5G, abruptly resigned from his post.

The circumstances of his resignation were not disclosed, but the Wall Street Journal reported that Redl has had conflicts with other political appointees at the current administration, including officials at the FCC. Redl, together with the Commerce Secretary, was tasked by President Trump to develop the country’s “National Spectrum Strategy” last October.

A few days before his resignation, Redl used his speech at Satellite Industry Association’s annual dinner to voice his concerns. “We don’t have to choose between making more spectrum available for the private sector and sustaining our critical government systems. We also don’t have to choose between terrestrial 5G and satellite services,” Redl said on that occasion. “To start with, satellite will play an important role in 5G connectivity, but perhaps more to the point these uses are not mutually exclusive; it’s just going to take hard work for them to continue to coexist in a more contentious spectrum environment.”

Meanwhile, FCC would not wait to have the “comprehensive, balanced and forward-looking” spectrum strategy in place before it pressed ahead with the auction of the mmWave frequencies, including the 24GHz and 37GHz bands that are also being coveted by the satellite industry. “I can’t recall ever in the past watching two different arms of an administration get into this kind of public disagreements,” FCC Commissioner Jessica Rosenworcel commented.

In other cases, Redl’s opinions often carried a lot of weight in FCC’s decision making. Before the decision was taken to deny China Mobile the operation licence, Redl’s earlier note had already set the tone. Ajit Pai, the FCC Chairman, in his statement called Redl “a longtime colleague, who served with distinction during his 18 months at NTIA.  He was a vocal advocate within the Department of Commerce for repurposing federal spectrum for commercial use and fostering the private sector’s lead in 5G deployment.  I thank David for his service and wish him all the best in his future endeavors.”

It may or may not be related, but Redl’s resignation also coincided with fresh pressure from the US on the UK to join the alliance to ban Huawei from the country’s 5G networks. The DC-based news outlet The Hill reported that Diane Rinaldo, Redl’s former deputy, would be taking over as acting administrator.

Amazon gets into the satellite connectivity game

All the cool kids have low-orbit nanosatellites these days and Amazon is not about to miss out on the latest connectivity fad.

The news comes courtesy of some pro sniffing about from Geek Wire, which spotted a bunch of new filings made with the International Telecommunications Union last month via the FCC by a company called Kuiper Systems. The dogged hack followed his hunch and got in touch with Amazon to see if it was involved and got the following response.

“Project Kuiper is a new initiative to launch a constellation of low Earth orbit satellites that will provide low-latency, high-speed broadband connectivity to unserved and underserved communities around the world. This is a long-term project that envisions serving tens of millions of people who lack basic access to broadband internet. We look forward to partnering on this initiative with companies that share this common vision.”

It seems to be very early days for this project, but if Amazon’s behind it you can be sure it will be well funded. Furthermore Amazon founder Jeff Bezos has always had a thing for space and has his very own rocket company called Blue Origin. It’s too early to say whether Bezos will get Blue origin to launch the Amazon satellites but you’d presumably get short odds on it.

As we recently found out from talking to nanosatellite startup UbiquitiLink, low-orbit satellites are handy because they don’t suffer from the kind of latency issues regular geostationary ones do. However you need a lot more of them to achieve the same area of coverage, hence the whole nanosatellite thing.

Loads of other companies seem to be thinking this is a promising business to get into, mainly to provide connectivity to remote areas but, if you’ll excuse the pun, the sky’s the limit. It’s not immediately obvious what the return on investment is on lobbing a bunch of satellites into space to help people who live in the middle of nowhere get online, but they’ve presumably given it some thought and reckon the sums add up.

$3.4 billion Inmarsat acquisition hype turns out to be true

British satellite communications company Inmarsat has been the centre of numerous acquisition stories in recent years, and this one is actually progressing.

Last week, the Inmarsat board released a statement confirming it was in preliminary discussions regarding a takeover, and today it has confirmed an offer is on the table. Not only will this put $3.4 billion into the pockets of the shareholders, it will also take the firm back into private equity, protecting it from the roller-coaster ride which has been the satellite segment over the last few years.

“As experienced and long-term investors in telecommunications, the Consortium values and admires Inmarsat for its proven expertise in maritime, aviation, defence and broadband satellite communications, alongside its strong market positions and potential for growth,” a statement from the consortium reads.

“Our planned ownership will enable this innovative British company to fulfil its ambitions to become a global leader in next-generation satellite communications, including the fast-growing market for commercial aviation in-flight connectivity.”

Another important factor from the statement is that the Inmarsat headquarters will remain in London. This might have been a bit of an issue for any protectionist politicians which would have viewed Inmarsat as strategic national asset, but the consortium seems to be getting ahead of the game. Should the firm gain regulatory approval, the deal is expected to be completed in Q4 this year.

The consortium, named Triton Bidco, believes there is much growth to be realised in the satellite segment, though a “strategic management and a long investment horizon” is required. In short, if you want to see the profits, shareholder pressures need to be removed from the equation. The firms traditional markets, maritime and government, are becoming increasingly competitive, but with its global infrastructure and early entry into the in-flight connectivity market the consortium has clearly spotted some riches on the horizon.

With a price of $7.21 in cash per share (a 7% premium), as well as the support of the Board of Directors and its largest shareholder Lansdowne Partners, Inmarsat might be heading towards the consortium. Shareholders have been frustrated over recent months with weak earnings results and may well look to exit with some spending money. For Inmarsat, the deal will create some much-needed breathing room to explore the long-term role of satellite in tomorrow’s world of connectivity.

Inmarsat once again in the acquisition crosshairs

Acquisition rumours are once again swirling around British satellite company Inmarsat, this time to take the company back to private equity control for £3.3 billion.

The consortium, featuring Apax, Canada Pension Plan Investment Board, Ontario Teachers’ Pension Plan Board and Warburg Pincu, comes at a time where the firm has been facing investor pressures. Over the last six months, poor performance from Inmarsat share price decline by 26%, while acquisition rumours have caused this trend to reverse recently. Share price is still down, but there does seem to be appetite in the market for an acquisition.

On January 31, Inmarsat received a non-binding proposal from the consortium offering $7.21 per share for the entire issued, and to be issued, share capital of the firm. The offer values the business at $3.3 billion, roughly £2.5 billion. This is not a concrete offer, but it is seemingly enough to get the market excited.

Although Inmarsat has reported flat sales growth in its core business units, maritime and government connectivity contracts, there has been increased demand in the aerospace industry, as more airlines demands connectivity, while 5G is on the horizon. The failure to deliver material progress on the promises does seem to be frustrating investors, but there is potential.

While satellite connectivity has been snubbed in recent years, usecases which demand ubiquitous connectivity in the future imply satellite has a broader role to play outside of the developing nations. Due to the civil engineering difficulties, and sometimes commercial constraints of connectivity, satellite is increasingly becoming a critical component of the connectivity mesh.

Interestingly enough, Apax might be a familiar sounding name to Inmarsat lifers. Apax was part of a consortium which bought the satellite firm in 2003, before taking it public two years later.

For some, this might be good news, but what is worth noting is this deal will be placed under scrutiny from the UK Government, which will view Inmarsat as a national strategic asset, and other attempts have failed. EchoStar attempted to acquire the business last year, investors rejected an offer worth £3.2 billion, while Eutelsat was also rumoured to be considering a bid.

OneWeb bags another $1.25 billion for global satellite mission

London-based satellite company OneWeb has announced it has secured an additional $1.25 billion in new capital, taking the total funds raised to $3.4 billion.

Having launched it first assets into the skies on February 27, the funds will be greatly welcomed considering the scale of ambitions here. In its mission to deliver high speed, low latency, seamless broadband access everywhere on Earth, from Q4 the team will begin monthly launches of 30 satellites to create an initial constellation of 650 satellites. OneWeb certainly has big ambitions.

“This latest funding round, our largest to date, makes OneWeb’s service inevitable and is a vote of confidence from our core investor base in our business model and the OneWeb value proposition,” said Adrian Steckel, CEO of OneWeb.

“With the recent successful launch of our first six satellites, near-completion of our innovative satellite manufacturing facility with our partner Airbus, progress towards fully securing our ITU priority spectrum position, and the signing of our first customer contracts, OneWeb is moving from the planning and development stage to deployment of our full constellation.”

While the images and PR story on the company’s website would leave some to believe this is a philanthropic mission to connect the unconnected, such good will would not attract weighty investments from the likes of Softbank, Grupo Salinas and Qualcomm. The addressable niches are quite broadly spread and certainly profitable.

“OneWeb has extended its first-mover advantage and is on track to become the world’s largest and first truly global communications network,” said Marcelo Claure, CEO of Softbank International.

“At SoftBank, our aim is to invest in transformative companies at the leading edge of technology disruption. OneWeb’s potential is undeniable as the growth in data from 5G, IoT, autonomous driving and other new technologies drives demand for capacity above and beyond the limits of the existing infrastructure.”

OneWeb has stated it will begin to offer commercial services from 2020, providing a neutral Internet access service, allowing any MNO or ISP to extend their services over OneWeb IP connectivity. The team is also pitching the constellation as a ‘5G Ready Network’.

OneWeb’s priority rights to a large block of globally harmonized spectrum and its Low Earth Orbit (LEO) constellation design will aim to create what it describes as a ‘truly global service’, addressing the connectivity needs of the autonomous vehicles, maritime logistics, offshore oil rigs and drill-ships, as well mobile backhaul in some of the more challenging geographical environments.

Although the concept of satellite connectivity has become relatively unfashionable in recent years, the demands of ubiquitous connectivity are creating a resurgence of interest. The perception of satellite might not be the most attractive, but it is quickly becoming a critical component of the connectivity mesh.

Nanosatellites could be the answer to mobile not-spots

Start-up UbiquitiLink reckons it’s cracked the challenge of affordable satellite connectivity to regular handsets through the use of nanosatellites.

You can’t use traditional geostationary satellites to fill regular cellular coverage gaps because they’re too expensive and are positioned 35,000 km above the surface of the earth, which is way further than cellular signals are designed to go and introduces excessive lag to the signal. An obvious solution is to use satellites at a much lower orbit, but until now that hasn’t been economically viable.

UbiquitiLink reckons it has the answer to this conundrum and went to MWC last week to tell everyone all about it. We spoke to CEO Charles Miller to hear directly what’s so different about what his company’s doing, compared to the traditional satellite connectivity business.

A key development seems to be the evolution of the satellite business, of which Miller is a veteran. It’s apparently a lot cheaper to build a satellite these days, using off-the-shelf components and assembly lines. This makes the production of large numbers of smaller satellites – nanosatellites – relatively affordable for the first time.

The ideal altitude for a cellular satellite is around 500 km, it seems – 70 times closer to earth than a geostationary one. But at that height the area covered is much smaller, hence the need for more of them. The cost of launching these into space is apparently coming down rapidly too, thanks to billionaire entrepreneurs like Elon Musk and Jeff Bezos.

One more challenge is the fact that mobile phone protocol apparently never expects to have to transmit further than 35 km from a terrestrial base station thanks to the curvature of the earth. In order to be able to use regular protocols and spectrum, Miller said his company has developed some kind of hack that prevents your phone freaking out when it has to deal with much more lag than it’s expecting (although imperceptible to us mere humans, we’re told).

UbiquitiLink has already launched a bunch of these nanosatellites 500 km into space and is now ready fill those not-spots. Its business model is to sign roaming deals directly with MNOs, who will then offer the service to their punters when regular connectivity isn’t an option. At first it will just offer messaging, but move into data when things ramp up.

This seems like a pretty major undertaking that will need to generate a lot of business before it sees significant ROI. But we’re not aware of anyone else claiming to have cracked the satellite cellular connectivity market so Ubiquitilink seems to have first mover advantage and the total available market would appear to be pretty big. Here’s a diagram illustrating its proposition.

Ubiquitilink graphic cropped

Security discussion needs to be bigger than Huawei – Vodafone UK CTO

Huawei is an obvious risk when you are assessing the vendor landscape, but to ensure supply chain resilience and integrity, focusing too narrowly on one company poses a bigger risk, according to Vodafone.

It might be easy to point the finger at China, but according to Vodafone UK CTO Scott Petty, this is a dangerous position to take. Despite a lack of evidence to suggest backdoors are being built into Huawei products, the world is determined to find one, but in reality, there isn’t a single company in the vendor ecosystem which can justifiably state they are 100% secure. This is the world we are living in; risk is everywhere.

“The discussion about Huawei is all managing the risk appropriately,” Petty said at a briefing in Central London.

Risk is a big topic at Vodafone UK right now, and this is clear when you look at how the vendor ecosystem is being managed.

On the radio side of the network, of the 18,000 base stations Vodafone has around the country, Huawei equipment accounts for 32% of them, Nokia 12% and Ericsson taking the remainder. Interestingly enough, Nokia equipment is being phased out in favour of Ericsson. For transmission, this is split between Juniper, Cisco and Ciena, while Cisco is responsible for the core. With this blend of vendors, and appropriate security gateways between each layer of the network, Petty feels Vodafone is managing the risk very appropriately.

And while some might suggest having this much exposure to Huawei might be a negative, Petty argues radio is such low risk it shouldn’t dictate play. You have to take into consideration the risk/benefit equation.

When assessing risk, Vodafone (working with the National Cyber Security Centre) considers two possible scenarios. Firstly, what is the risk of a nefarious actor leaching data from the network, and secondly, taking down the network. On the radio side of things, the exposure is very low.

Firstly, Vodafone has 18,000 base stations throughout the UK. Should one of these base stations be compromised, only the traffic going through that base station would be at risk. This will be a fraction of the total, devices will be handed off to other base stations as people move around, while the clear majority of internet traffic is encrypted nowadays. The likelihood of a nefarious actor trying to bleed valuable insight in this manner is low.

Secondly, even if one of these base stations is taken down by the external wrong-doer, this is only one of 18,000 base stations. To have a material impact on Vodafone’s network, hundreds or even thousands would have to be impacted simultaneously. This is not inconceivable, but highly unlikely. As Petty mentioned, its all about evaluating and minimizing risk.

This is where the discussion becomes incredibly complicated. Huawei is one of the leading names (if not the leader) in the radio segment, ignoring such a vendor is a difficult decision to make as a technologist; you always want to use best in class.

For transmission, another area Huawei would be considered a leading name, the risk has been identified as medium. You would still need a lot of compute power to crack the encryption software, but Vodafone have decided to steer clear of Chinese vendors here.

Finally, onto the core, the most important part of the network. Petty pointed to O2’s issues last year, where a suspect Ericsson node effectively killed the entire network for a day, to demonstrate the importance of this component. Cisco is the vendor here, but this leads us onto the dangers of a such a narrow focus on security.

When looking for signs of a telco vendor assisting a government for intelligence activities, there is arguably only one piece of concrete evidence to support such claims. Edward Snowden produced this evidence, proving Cisco was aiding the NSA for its own spying agenda. This is the reason we suspect the US is so convinced China is spying on the rest of the world; the US government is doing the same thing and therefore knows it is technologically possible.

We are of course not accusing Cisco of aiding the US government in this manner at this moment, but such is the sophistication and technological capabilities of those on the dark web, no company should consider themselves 100% secure. They have their own supply chains which could be vulnerable at some point. The complexities of this ecosystem mean nothing is 100% secure, therefore it comes down to risk assessment, and also the mitigation of risk through layers of security, gateways and encryption.

For Petty, the establishment of Huawei’s European cyber-security centre is a step in the right direction, though he would want the European Union to play an active role in its operations and for the net to be cast wider, considering all vendors. As mentioned before, too much of a narrow focus on one area heightens the risk in others.

However, the talk of a Huawei ban would be a disaster for everyone involved.

“We don’t think a complete Huawei ban would be a proportionate response,” said Helen Lamprell, Vodafone UK’s General Counsel & External Affairs Director.

If risk is appropriately managed and mitigated, business can continue as usual. Policy decision makers have to realise there is no such thing as 100% secure. A broad-sweeping ban on Huawei would be disastrous not only for Vodafone UK, but everyone in the connected economy.

Firstly, you have to think of the cost of removing all Huawei equipment. This would cost hundreds of millions and take a considerable amount of time. This would delay the introduction of 5G and fundamentally undermine the business case for ROI. It could set 5G back years in the UK, not only for Vodafone but the whole industry.

The supply chain review is currently working its way through the red maze of UK government, and while the certainty needs to arrive sooner rather than later, getting the review right is better than speed.

The message from Vodafone this morning was relatively clear and simple; the Huawei risk can be managed, but an outright ban would be disastrous.

Don’t let satellite get lost in the 5G buzz – Intelsat`

With 5G plastered on every wall, floor and door in the Fira, it can be easy to forget there are other important components in the connectivity mix.

Speaking to Jean-Philippe Gillet, GM of Intelsat’s network business, the message is relatively straight-forward; don’t forget about us, don’t forget about satellites.

“Does satellite play a prominent role in the developed markets? No,” said Gillet. “But it is important in the developing markets. We are trying to show people success in developing markets can be translated into the developed one.”

With all the euphoria surrounding 5G at this years’ event, and more generally across the last couple of years, satellite is often seen as a fall-back option, not necessarily a useful component of the connectivity mix. This is the perception which Gillet and Intelsat is attempting to change.

The idea of tomorrows digital society is one which is defined by 5G and fibre. Few other conversations are given a suitable amount of attention with these two bully boys grabbing the headlines, but satellite needs to be a consideration.

“It’s about creating a hybrid connectivity model which positions the right medium for the right application,” said Gillet.

While Gillet suggests there are eager listeners for anyone who is facing the connectivity conundrum, there are sceptics. There is somewhat of a lazy stereotype that satellite’s function should be limited to the developing markets, but Gillet is working to change this perception.

Alongside the incremental but promising progress in terms of satellite technology, the team has recently launched its next generation of satellites, EPIC. These six assets offer worldwide coverage, and the team have already signed up two prominent Asian telcos as customers, as well as one in the US. The next generation of satellites will be software defined, allowing Intelsat to move around capacity, while the company is now a fully-fledged member of the GSMA.

“We want to be sat at the table to help make connectivity decisions,” said Gillet.

Justifying the inclusion of satellite as a genuine component of the hybrid connectivity mix might be an uphill battle but considering the demands which are being placed on telcos to bridge the digital divide, there is hope.

Competition is a problem, removing Huawei could be disastrous – Vodafone CEO

With all eyes in directed towards Mobile World Congress this week, Vodafone CEO Nick Read took the opportunity to vent his frustrations.

Competition is unhealthy, accusations are factually suspect, protectionism is too aggressive, the trust with customers has been broken, collaboration is almost non-existent. From Read’s perspective, there are plenty of reasons the 5G era will be just of much of a struggle for the telcos as the 4G one.

And of course, it wouldn’t be a telco press conference if there wasn’t a reference to Huawei.

“I would like a new contract for the industry, I want to go out and build trust with consumers and businesses,” said Read. “This will require us to engage government and build the vision of a digital society together.”

Read has reiterated his point from the last quarterly earnings call, there needs to be more of a fact-based conversation around the Huawei saga. There is too much rhetoric, too much emotion, and perhaps, too much political influence.

Huawei is the punching bag right now, but any ban or heavy-handed response to US calls for aggressive action would be a consequence for everyone.

As Read points out, Huawei is a significant player in almost everyone’s supply chain, controlling roughly 28% of mobile infrastructure, while Nokia and Ericsson also have market share in the 20s. Removing one of these players from the market will further compound a problem which plagues the industry today; the supply chain is too concentrated around a small number of vendors.

There simply isn’t enough diversity to consider removing a key cog to European operations.

Of course, you have to consider the status quo. The US is happy to ban Huawei as it has never been a significant contributor to its infrastructure. Should the same ban be enforced in Europe, negotiations would be de-railed, and operations disrupted. Read suggests this would set 5G plans back by two years across the bloc.

The issue here is of confidence to invest. Why would telcos enter into deep negotiations when future conditions have not been set in stone. This is already evident in Vodafone’s decision to pause work on the core with Huawei; delaying these important initiatives could push Europe further behind global 5G leaders. Telcos need confidence, certainty and answers. The longer reviews go on, the more precarious the situation becomes.

This is one of the many challenges the industry is facing. There is an ‘us versus them’ mentality when it comes to telcos. Read is referencing the relationship with regulators and government, suggesting a lack of collaboration which is negatively impacting the ability to operate, but it is also evident in the relationship with the consumer and competitors. Collaboration is a key word here.

One example of collaboration is in the UK where the National Cybersecurity Centre effectively monitors Huawei equipment. This model could be rolled out across Europe, though Read’s stressed the point that there would have to be a harmonised approach. Fragmentation is the enemy here, and it would stifle progress. If there is a European level of monitoring, or even if it is taken down to nation states, it doesn’t actually matter as long as it is consistent.

The Huawei ban is set to become one of the talking points of this years’ MWC, that is not necessarily an idea anyone will be surprised about, but what we are not sure about is the disruption. Will it slow 5G development? Has the uncertainty already slowed 5G development? Will the anti-China rhetoric, dilly-dallying and confusion kill Europe’s ambitions in the global digital economy?

Europe sailing towards conflict over China 5G

Germany is drafting rules to allow Chinese companies to participate in the 5G bonanza, while the European Commission is thinking of banning them. Something’s got to give.

In terms of collective political influence and economic power, the European Union could consider itself more or less on par with the US and China. Considering the Union represents the societal, political and economic interests of 28 nations, more than 500 million people and roughly $23 trillion in GDP, it is certainly a powerful concept. But the China issue is just one example of how its neatly stitched patchwork could unravel very quickly.

China is a very tricky equation to balance right now. On side, you have an incredibly powerful economy, a massive and increasingly wealthy population and technological advancements which could benefit almost every society. However, to access these riches you have to deal with a government which ideologically conflicts with a lot of what Europe stands for.

But this is where a potentially significant conflict lies. The European Commission is reportedly looking at how it could create a de facto ban for Chinese technology and kit in communications infrastructure, conflicting with some of its member states positions. The Commission is supposed to represent the interests of all its member states, creating a common framework which sits above national policies, but if these policies are a contradiction of opinions of some member states the perfect storm could be brewing on the horizon.

Germany is not talking the anti-China rhetoric

The most recent reports echoing out of Berlin will not have the US government jumping for joy. Local newspaper Handelsblatt is suggesting the German government is doing everything it can to write security protections into new regulation, however, the rules will be written in a manner which will not exclude Chinese companies.

The reports have not been confirmed by any official government spokespeople as of yet, though this does follow on from the Federal Office for Information Security (BSI) made in December.

“For such serious decisions like a ban, you need proof,” said Arne Schoenbohm, President of BSI.

The US will not be happy about developments here, a delegation is currently undertaking a European lobby tour to turn officials against China, though neither will the European Commission. There are several instances which indicate the European Commission is taking a similar stance against China, suggesting a bloc-wide ban could be on the cards before too long.

Aside from recent reports the European Commission is rewriting cybersecurity rules to effectively ban Chinese companies from providing technology for communications infrastructure, one of its Commissioners has also fuelled the anti-China rhetoric.

“I think we have to be worried about these companies,” Commissioner for Digital Single Market Andrus Ansip told reporters in December. Ansip was referring to companies such as Huawei and ZTE, while this statement implies the Commission believes there are strong ties between multi-national corporations and the Chinese government.

The United States of Europe argument emerging again?

With Germany seemingly working to ensure collaboration with Chinese companies remains possible, the UK creating monitoring mechanisms to enable Huawei’s work and Italy denying reports it is considering its own ban, the European Commission appears to be working in direct contradiction to some of its largest member states.

To be fair, the role of the European Commission is to serve all the states not just the big ones, but the point of the bureaucracy is to create a common framework which all agree on, not rules which are forced onto member states. Cynics of the Commission and Union in general will suggest this is perhaps more evidence of Juncker and co. attempting to create a United States of Europe, where the desires of the member states are secondary to that of the ruling party.

Although many of these conspiracy theories are generally relegated to the comment boards of the Daily Mail, the Commission might well be heading towards a monumental conflict. Any rules which are written at European Commission level would potentially render national regulations redundant, a scenario those member states would not be happy with.

Considering the shoddy state of affairs Brexit has been creating, perhaps the European Commission should attempt to create an image of co-operation and collaboration. Antagonising leading member states is not a sensible idea, while a ‘state v. Europe’ conflict over security is not something which will reflect favourably on the agency.

Is politics anything more than arguing with shiny teeth?

Caught on the fringes of this conflict and the constant political seesawing are the telcos. Governments often tell the telco industry they are there to help and enable innovation, but it seems most of the time politicians are nothing but a hindrance attempting to score PR points by pandering to buzzwords and public opinion.

With governments aiming to ban Huawei and ZTE from connectivity plans, several telcos have stepped into the fray to give their own opinion. The message seems to be relatively consistent; heighten security requirements if you must but banning a vendor in an incredibly top-heavy market will not be a good idea.

“Clearly, if there were a complete ban at radio level, then it would be a huge issue for us, but it would be a huge issue for the whole European telco sector,” Vodafone CEO Nick Read said during the latest earnings call. “Huawei probably has 35% of the market share through the whole of Europe.”

Deutsche Telekom is another who foresees any Huawei ban being nothing but problematic. The German telco has previously stated a ban on Huawei would set its 5G ambitions back two years. Several telcos are considering scaling back work with Huawei, but this is perhaps directed more towards the uncertain political climate than any outright worry regarding the security credentials of Huawei equipment.

European telcos are not dependent on Huawei equipment to function effectively, but they are somewhat reliant on it. There aren’t enough suppliers, or good-enough suppliers, to strike Huawei out of the mix. US telcos are not having to deal with this headache as their operations adapted to a lack of Huawei and ZTE years ago, Europe is struggling with the political seesawing and story of uncertainty. Any business leader will tell you, a consolidated, cohesive and concrete regulatory landscape is critical for success.

Huawei stuck between a rock and a hard place

Huawei is a company which now has no control over its own fate.

With the US parading around political offices spreading its anti-China message without the burden of evidence, Huawei can’t do anything. Numerous governments are asking the vendor to prove its security credentials, but this will mean little is there is still suspicion. The case against Huawei is not based on evidence, but one which is based on a political and economic power struggle.

With a lack of evidence to substantiate any accusations against the firm, Huawei is being asked to do something which has been accepted as almost impossible; prove a negative. All of the questions and queries being directed at the firm have a single aim, to demonstrate there are no ties between the organization and the Chinese government, as well as its intelligence agencies.

It’s an almost impossible task, especially when you take into account the powerful influence of the US and the fact most of these decisions are being made on hearsay, circumstantial evidence and emotion. Whatever Huawei says, however much evidence is put on the table, we suspect opinions have already been made.

An issue of consistency and contradiction

In a single signature, the European Commission could throw the bloc into disarray. If the rumours evolve into reality, the European Commission could impose its own rules, contradicting the hopes and ambitions of some member states. Such a scenario would question how much control the member states have over their own society, undermining the concept of sovereignty.

Any fundamental changes would certainly have to be greenlit by all member states, but the European approach to China on the whole, and Huawei specifically, has not been entirely consistent. One question which might be worth considering is whether the European Commission is overstepping its remit.

We are almost certain Germany will not be happy being told to ban Huawei considering it seemingly wants to ensure Chinese participation in the upcoming 5G bonanza. Conflict is on the horizon, potentially pitting the European Commission against the biggest financial contributor to the bloc.