Tech ban will keep UK hanging on for 5G for an extra three years
Despite dire warnings of a digital divide, down the line the industry will cope, writes Hasan Chowdhury
The ban on Huawei “threatens to move Britain into the digital slow lane, push up bills and deepen the digital divide”. That was the predictable response from the Chinese telecoms company after the UK bowed to US pressure and ordered the phased removal of Huawei from its 5G network.
The decision was based on a review by the National Cyber Security Centre (NCSC) into Huawei’s role in the UK after US sanctions barred its access to American products – a move the NCSC claims makes Huawei an increased security risk.
Under the plans, telecoms operators will not be able to add any new Huawei components to their 5G networks from the end of this year. All equipment made by Huawei must also be removed from 5G infrastructure by 2027.
The ban will cost UK operators as much as £2bn, and will delay the rollout of 5G networks by between two and three years, the Government said. But the real cost could be even greater. “While any benefits from the improved security may never become apparent, the rollout of 5G networks in the UK will inevitably be slower and more expensive as a result of the decision,” says Dan Ridsdale, analyst at Edison Group.
Fifth generation mobile technology, which enables download speeds 10-20 times the current rate, is likely to have a profound impact on innovation.
Just as the internet thus far has revolutionised human communications and transactions, from video calls to social media to eBay, 5G will extend that network effect to inanimate objects.
It promises a world in which cars can communicate with cars, with the roadway and with the people around it. In this vision 5G will be an enabler whose chief effect is to unleash new products and tools.
Usage of high-speed internet connections in the healthcare, manufacturing, retail, and mobility sectors alone could increase global GDP by between $1.2 trillion and $2 trillion by 2030, according to the study from the McKinsey Global Institute, the consulting firm’s research arm.
‘The rollout of 5G networks in the UK will inevitably be slower and more expensive as a result of the decision’
Improved connectivity will also automate tasks, allowing caregivers to spend more time with patients. McKinsey said that healthcare could generate an additional $420bn (£333bn) in global GDP.
It may still be in its infancy, but 5G applications have already emerged in the UK. In Worcester, a factory to build boilers involves sensors using 5G to ensure production lines run smoothly with little human oversight.
The likes of Samsung have rolled out 5G smartphones, while cities such as Bristol are using 5G to collect data on the way their city runs and improve traffic flow and air quality.
In the healthcare industry, hospitals have started to explore uses of 5G for the remote monitoring of Covid patients with telemedicine apps, for example, or sensors keeping a check on critical health indicators. In the midst of a public health crisis, then, delays to a 5G rollout could have dire consequences.
Any slowdown to the introduction of these applications would snatch away a real economic opportunity for the UK. Research conducted by Assembly previously estimated there will be an economic hit of £6.8bn from not deploying 5G.
There are also fears of increasing the digital divide in the UK. “Most rural areas have been heavily reliant on 2G, 3G and 4G and in some cases don’t have 4G... when you talk about 5G to ensure network access in rural areas, there will be an impact for sure,” says Paolo Pescatore, industry analyst at PP Foresight.
All is not lost, however. Operators such as BT and Three have already engaged other suppliers to secure gear that can replace Huawei’s kit.
Time should be on their side too. Neil Campling, analyst at Mirabaud Securities, sees the government’s timetable for Huawei’s removal over the next seven years as “not as impactful as first feared”.
Philip Jansen, BT chief executive, said the company was confident its existing networks would not be significantly impacted by the decision.
“The security of our networks is an absolute priority for BT,” Jansen said.
“Clearly this decision has logistical and cost implications for communications providers in the UK market – however, we believe the timescales outlined will allow us to make these changes without impacting on the coverage or resilience of our existing networks.
“It will also allow us to continue to rollout our 5G and full fibre networks without a significant impact on the timescales we’ve previously announced.”
With 5G already boosting some services in the UK, its true success in shaping the future of healthcare, regions outside of London and multiple other industries will come down to not only selecting the correct gear, but also rolling it out quickly.
A mobile phone mast in Reading, stripping Huawei from the 5G network will be costly