After banning Chinese comms bogeyman, UK asks: Huawei in this mess? It was a failure of capitalism, MPs told
- Reference: 1595434565
- News link: https://www.theregister.co.uk/2020/07/22/huawei_commons_sci_tech_committee/
- Source link:
Following the [1]ban of the firm's gear in the nation's 5G deployment, the government is doing some soul-searching to find out how it became so dependent on one particular vendor.
One cause, MPs were told at a meeting of the [2]House of Commons' Science and Technology Committee , was a "failure of capitalism".
"Free markets essentially failed the US, Canada, and the UK in creating this gap," said Amy Karam, fellow at the Canadian Global Affairs Institute.
UK smacks Huawei with banhammer: Buying firm's 5G gear illegal from year's end, mobile networks ordered to rip out all next-gen kit by 2027 [3]READ MORE
"Creating Radio Access Network (RAN) equipment is not very lucrative. So when you look back and ask why the US doesn't have this, it's because its network providers – Cisco was the giant over the last – didn't invest. They were beholden to shareholders, Wall Street," she added.
Karam also fingered individual governments that failed to save their own domestic competitors from bankruptcy. "Canada could have had Nortel with a $2bn-$4bn bailout and chose not to," she said.
Nortel was a giant of the Canadian tech scene, providing fixed-line and wireless infrastructure. In 2009, it filed for bankruptcy protection following years of losses in the aftermath of the dot-com bubble and an accounting scandal. The remnants of the company were promptly snapped up by international competitors, including Alcatel-Lucent (now Nokia), Ericsson, Avaya, and Apple.
Closer to home, there's also the sorry case of Marconi Communications, which was largely acquired by Ericsson after the dot-com bust. The remainder now exists as Telent, which mostly provides network installation services for the transportation and government sectors.
Arguing in favour of a government-led industrial policy, Karam said: "We let free markets decide [to create RAN kit], and they decided it wasn't lucrative."
She added: "This economic security is now impacting our national security concerns, so we have to shift that mindset from 'free markets' into 'how do we help national security with economic policies'."
This wouldn't be without precedent, Karam argued, saying that Huawei's success comes from its alleged support from the Beijing government. This is something that Huawei has steadfastly denied, insisting that it's a privately owned company that operates independently from the government.
"We need to figure out how we foster that mass competitive advantage across a lot of vendors," she said.
But what does that look like in practice? Karam dismissed the idea of creating a new RAN vendor in the short-to-medium term, but noted that the problem could be "leapfrogged" with software-based solutions like OpenRAN technology.
"You also have to mandate this solution be operated by vendors and operators alike," she said. "It's really important for everyone to be onboard." ®
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[1] https://www.theregister.com/2020/07/14/huawei_ban_uk/
[2] https://committees.parliament.uk/event/1657/
[3] https://www.theregister.com/2020/07/14/huawei_ban_uk/
[4] https://whitepapers.theregister.com/
Re: Obvious
Why bother doing anything else when you can launder criminals' money?
Devided Opinions Anyone
Not for nothing did the UK company I worked for have a 'mixed' opinion of Nortel. My area referred to them as the granny shifters who would sell you their granny if they could make a buck, but they generally had nothing useful to deliver. Even offering to sell items that they would buy in from other makers, (who told us they had no interest in making a loss to produce those devices). Other parts of the company loved their older kit, though Nortel did not always know how to make it all work reliably in field situations. GEC/ Marconi was not respected, often referred to as a bunch of old has-beens by one group. I thought that some of their offerings might have had more to them than they were given credit.
Re: Devided Opinions Anyone
For many years, GEC and Marconi were populated at the top by useless ex-army colonels or some bloody lord Farquhar and the like and it was perpetuated when they retired on lovely pensions. It was nepotism personified.
BAe is exactly the same but somehow managed to hang in there. Of course when I say “somehow” I mean the same ex-army top bods have lots of friends in government. Which happens to come in very handy when some low life tries to expose the open secret of bribing the Saudis. Now that was rather inconvenient. Good job the government decided it “wasn’t in the National interest” to actually admit publicly what anyone working in that area had known openly for decades; they even used to figure bribes into the project budget (not a joke. Not made up).
Failure of capitalism
So our cell network should use systems designed and built in Britain, manufactured in Britain, using components from Britain, built from raw materials from Britain, mined by British workers using British built mining gear.
That sounds very much like a different ...ism
Obvious
Can’t comment on Canada and the US but here in the UK we have a strong tradition of treating industry as something you scrape off your shoe.
Thatcher very famously stated “we don’t need a manufacturing sector. The country can survive on service industries alone” (I paraphrase).
And so 30 years or so later you end up in a situation where you have lost almost all your top talent, and the manufacturing companies that are still trying to make something of worth are unsupported by government and ignored by the banks (now THERE’s a worthwhile “industry” - very nice suits and shiny boardroom tables, and none of that demeaning “manufacturing” nonsense).
On top of that we allow any industry of any worth at all to be sold to (literally) anyone - Arm probably being the latest high profile example. But that should come as no surprise - we don’t even own our own water supply any more in this country (and allow said water companies to run up huge debts just so they can pay out a nice dividend to shareholders and pay their “top” peeps big money - it is quite literally a scandal but that’s another subject)
In the meantime we happily POUR money into China so that it can make stuff for us and fund its military that it might want to use against us in the near future.
Really. It’s not rocket science. It’s bloody depressing. But it’s not complicated