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UK PM Is Right: Where Is Huawei Alternative?

Dwindling band of powerbrokers
But costs are perhaps not the primary concern for today's operators. As the likes of Alcatel, Lucent, Motorola and Nortel have disappeared, service providers have become increasingly dependent on a dwindling band of international powerbrokers. Problems for any one of these companies could be massively disruptive, as the Huawei saga demonstrates. A formal ban on Chinese vendors would leave most service providers at the mercy of just two players: Ericsson and Nokia.

Neither is in the best shape. Ignoring its corruption scandal, Ericsson has recovered from its 2016 slump, when its very survival seemed on the line, but only by ditching assets and employees to focus almost entirely on mobile infrastructure. It lacks a convincing growth story outside 5G, which might not deliver the boost it expects. Nokia has a much broader range of interests but racked up a €545 million ($608 million) net loss for the first nine months of 2019. It has recently slashed profitability targets.

This situation at least partly explains the surge of interest in open radio access network (RAN) technology. Smaller mobile network vendors such as Altiostar, Mavenir and Parallel Wireless are touting products that use open interfaces and common, off-the-shelf hardware as an alternative to traditional gear. And some big operators are eager to bite. On a mission to find new suppliers, Vodafone is carrying out European trials of open RAN technology. If these go well, open RAN seems likely to play some part on the production side, with Vodafone's entire European network currently up for tender. Telefónica is already using open RAN in some commercial networks.

But in a mass-market sense, open RAN is still not ready for prime time, and it could not fill the void left by a banned Huawei. Software developed by some of the main contenders will not yet work on general purpose x86 servers. The market for "white box" radios remains immature. And open RAN still lags traditional products on technical performance, according to analysts at Dell'Oro and Heavy Reading, two market-research firms. If all this weren't enough, multivendor open RAN networks could bring all sorts of operational complexity for service providers, driving up day-to-day costs.


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Johnson is therefore right to ask questions about Huawei alternatives. While the debate about security grinds on, without generating any certainties, the UK's operators will have conveyed to the new government just how much worse off they would be in a Huawei-free market. The prime minister's off-the-cuff remarks suggest he has been listening: A comprehensive ban on the controversial Chinese company now seems highly unlikely.

While anything remains possible, the likeliest scenario is that UK authorities will plump for the compromise aired last year, shutting Chinese vendors out of the 5G "core," a particularly sensitive part of the network, but allowing it to sell radio equipment, which accounts for most of the 5G investment. This would cause zero disruption for UK operators, which have either avoided using Chinese core network products or been switching to alternatives. For that reason, it would not seriously upset Chinese authorities, which recently warned that a full Huawei ban would damage relations with the UK.

The UK government probably thinks it can persuade the Trump administration this compromise makes sense. It will not be easy while the US continues to wage war against Huawei, and there is much at stake. Some experts insist distinguishing between core and radio will become harder in future 5G networks. Upsetting Trump could imperil a future trade agreement with the US. And for Huawei's fiercest US enemies, the UK's refusal to ban Huawei would set a dangerous international precedent. After all, if the US cannot win over one of its strongest allies, what hope does it have elsewhere?

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— Iain Morris, International Editor, Light Reading

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Director60363 1/16/2020 | 5:00:21 AM
Vodafone argument is false Most of the UK Network Operators are part of larger Global Groups so to say that Vodafone UK can’t go for Ericsson or Nokia is a false argument. Their parent group can always play UK against Spain or South America, etc.
gategore 1/16/2020 | 2:22:04 AM
Re: Disruptors and other threats Yet neither of the Nordic vendors has been covering itself in glory of late: Ericsson has just agreed to hand over $1 billion to US authorities to settle numerous international charges of bribery and corruption between 2000 and 2016; Online moto x3m game!
ethertype 1/15/2020 | 6:13:30 PM
UK PM is Wrong: There are Plenty of Huawei Alternatives Stupid click-bait headline got me. I thought, "Seriously? Does LR not understand that there are perfectly viable alternatives to Huawei?"

And then I read the article and found that it clearly lays out all of the alternatives.

Not satisified with Ericsson and Nokia? Well then, it's high time for Samsung to be given a legitimate opportunity to break into the top tier.

Want even more choice? Do the ACTUAL WORK to help define, build and deploy open, disaggregated alternatives.

If you claim that you must have Huawei as a supplier, and the world will end if you can't, then you are clearly too lazy to keep your job.

The only alternative hypothesis is that you are so thoroughly corrupted and in Huawei's pocket that you can't understand. As Upton Sinclair famously said, "It is difficult to get a man to understand something when his salary depends upon his not understanding it."
Duh! 1/15/2020 | 1:34:27 PM
Disruptors and other threats I wouldn't write off the OpenRAN vendors as strategic alternatives to Huawei. The operators are putting too much energy into that effort, including opening their labs to disruptors. True that there are teething pains. History shows that more often than not, those are temporary. More likely than not, at least one of them will get to GA, major supply contracts and large-scale commercial deployment.

The motivation is margin compression.  Just as Huawei and ZTE "bought" themselves into international markets by undercutting established European and North American rivals, they are vulnerable to undercutting from low margin white box hardware. Some operators have effectively made that a cornerstone of their 5G strategy. Margin compression, of course, is one of the main factors behind the consolidation of the equipment market.

On a slightly different topic: if one wanted to mount an eavesdropping attack against, say, a military target, one would probably do so in the RAN, not the core. Specifically, the CU or perhaps an edge/aggregation router. Sorting individual flows out of a highly aggregated stream is not an easy task to perform, much less cover up. That gives rise to doubts that allowing Huawei into the RAN would solve the alleged problem. An RU or DU might be a lesser risk.
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