Chinese 5G equipment manufacturers in Berlin’s crosshairs

Published on September 20, 2023 at 6:58 p.m.

In Berlin, pressure is increasing to get rid of Huawei and ZTE as quickly as possible. Following a security audit carried out in the spring, the Interior Ministry is leading a campaign within the coalition to eliminate a large part of the equipment from the two Chinese suppliers by 2026.

The process would be done in two stages, according to a project presented to other ministries and revealed by the DPA agency. By January 1, 2026, operators Deutsche Telekom, Vodafone and Telefonica Deutschland (O2) must first have banned Huawei and ZTE from their core 5G networks.

A total ban in certain regions

Secondly, the access networks, that is to say the part comprising the base stations and the antennas, will have to see the share of Chinese components fall to less than 25% on average by October 1 2026.

But the ban could be total in particularly sensitive regions in terms of security, such as Berlin, the Cologne and Bonn region, or even Frankfurt am Main or Munich, given their financial and economic importance.

The first part of the plan did not make operators jump. In fact, Deutsche Telekom, Vodafone and Telefonica have already virtually banned Chinese equipment from their core networks in 2019-2020 to work with companies like Ericsson.

A situation quite similar to that of France, where a law ped in 2019 banned Huawei and ZTE on the core 5G networks. In France, restrictions on antennas have also been put in place in Paris or in strategic military zones such as Brest. Across the Channel, London completely banned Huawei from its mobile networks in 2020.

A calendar that raises questions

Devoted to access networks, the second part of the German project, however, arouses tension among operators because its timetable seems unrealistic. In Germany, Chinese equipment manufacturers supply nearly 60% of equipment at the edge of networks, for access to antennas, according to the consulting firm Strand Consult.

In absolute terms, the approach undertaken by the Social Democratic Minister of the Interior, Nancy Faeser, validates the security strategy vis-à-vis China, presented in Berlin in July . But that does not mean that it relies on consensus within the coalition. Some see the strong presence of the two Chinese companies as a danger similar to that of the Nord Stream gas pipeline, which had increased Germany’s dependence on Russian gas.

But for the Ministry of Transport and Digital Affairs, the impact on mobile internet speed and the cost of running the network must also be taken into account. “Our basic position is that the deployment of 5G is already subject to very high standards and strict rules regarding the use of critical components,” a spokesperson explained on Wednesday.

What’s more, the minister in charge, the liberal Volker Wissing, presented last year a vast plan to accelerate digital technology, which could seriously suffer from this type of decision.

“A negative impact”

For its part, the Huawei group indicated that this type of approach would have “a negative impact” on Germany’s digital transformation and the operating costs of its networks. But given the stakes, it is likely to be inaudible.

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