Huawei and 5G: China's Competition to the Top
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Founded in 1987, with less than 50 years of company history, Huawei has become one of the largest telecommunications equipment manufacturers in the world; acquiring even its own nickname as ‘The Chinese technology giant’.
The focus of this article will be on its involvement with the fifth-generation wireless technology for digital cellular networks, alternatively known as 5G, which began full worldwide deployment in 2019.
The competition for 5G infrastructure between countries is a competition in a variety of sectors and industries: technology, economy and even politics. Huawei, as the top Research and Development (R&D) company, attracted much attention recently in its involvement with the competition for 5G.
Huawei currently ranks at the top of 5G companies. When we searched online for “Huawei and 5G”, we found results like “Huawei Wins Top Ratings on 5G Mobile Core” and “Is Huawei, the leader of 5G?”. In the industry, it is believed that Huawei and Qualcomm are the main strong competitors. In June 2019, GlobalData published a report assessing the respective 5G RAN technologies from Ericsson, Huawei, Nokia, Samsung Electronics, and ZTE. Results from the report show that Huawei’s 5G RAN portfolio holds the most influential position overall, “with leading claims in all four criteria categories including superior baseband unit capacity and radio unit portfolio breadth”. Despite falling short of and being second to Qualcomm, the current largest smartphone manufacturer, Huawei’s mastering of the various techniques involved in the telecommunication operating chain, from base stations to core network, has helped it secure its leading position in the competition.
On the other hand, Huawei still faces many difficulties despite its various successful technological developments. Huawei and Qualcomm are leaders in their various sectors; the former being the master on the business of base stations and the latter specialising in the patents of core techniques. However, as Qualcomm owns the absolute advantage with the accumulation of patents after years, Huawei has had to pay royalties to use the patents in order to fill in the defects on techniques. Currently there are three digital coding plans available for 5G: LDPC by Qualcomm, Polar Code by Huawei and Turbo Code by French companies. Competition between the three has varied. Whilst Turbo has not been in the game, during the conference in 2016, which decided the channel code, LDPC took the leading position. Moreover, it has been said that Polar is not practically mature enough to be accepted worldwide.
Additionally, despite having made over 30 5G business contracts in 2018 alone, in comparison to the 18 made by the rival company Ericsson, the sales of Huawei has been considered relatively disappointing. Due to its leading position, it is almost expected for Huawei to have a much higher number of contracts than other competitors like Ericsson and Nokia. In reality, Huawei’s contracts are much smaller in size and amount to less when compared to other competitors. Moreover, prices of Huawei’s products are often lower than their main competitor. This means that Huawei has to sell more products to make a profit and chase the sales of the competitors.
Furthermore, cases like the Huawei trade ban demonstrate the influence of politics to be much more complicated and deeper than its perception and portrayal on media. Due to the complexity of the issues surrounding Huawei’s political implications, we have chosen to omit this from our current discussion. However, what this serves to prove is that Huawei still has a long way to go if they intend for an outright win and absolute dominance.
The development of 5G is the most eye-catching task for countries at this stage. Science and technology are techniques of primary productivity as it is unpredictable of the effectiveness of the application of 5G on the military, the economy and people’s daily lives. However, it is of great importance when discussing the potential risks of 5G to analyse both the complex background in its involvement in the various sectors and its specific localised effect in individual countries. Its influence should also be approached from a holistic perspective; taking into account both positive and negative outcomes as a result of its development in the 5G competition.