The global 5G equipment market is dominated by three companies: China’s Huawei, Finland’s Nokia, and Sweden’s Ericsson. Together, they account for roughly 80% of 5G base stations around the world, and until recently, Huawei was leading the pack, thanks to high-quality and competitively-priced network equipment.
But US intelligence officials believe that Huawei is linked to the Chinese military and Communist Party, and that it presents a security threat. Recently, the US barred companies that use American technology from selling chips to Huawei, effectively cutting off the company’s supply of essential semiconductors (Quartz member exclusive). The US has also pressured allies to prevent Huawei from supplying components for their 5G networks.
This has had an impact in Europe. In the past few weeks, Belgium’s National Security Council banned the use of Huawei equipment for its core 5G capacity and restricted the use of Huawei equipment in its radio access network (RAN). Germany’s main telecom operators said they will not use Huawei equipment in their core network. And according to reports in the Financial Times and Daily Telegraph, the UK government is drawing up plans to phase out Huawei technologies by 2023.