5G isn’t a race the West needs to bankrupt itself trying to win
Like the launch of Sputnik 1 in 1957, Huawei is not really a fight about technology. Rather, it is emblematic of a superpower showdown, a simple, scary signifier to the West that its pre-eminence is being challenged.
Then it was the Soviet Union. How can it be, Americans wondered as they tuned in to the disconcerting beep, beep, beep of the first satellite, that the communists in Moscow are not just matching the West, but surpassing it?
Now it is those communists in China. How is it that we don’t have our own 5G champion? How come we have to have this debate about deploying Huawei kit in the first place? Why don’t we have our own? Why aren’t we the best?
The answer to these questions is critical to the decision to integrate Huawei into Western infrastructure – and the future of the Sino-american struggle for supremacy.
First, though, it may offer some comfort to know that China is posing itself similar sorts of questions. Why, senior party officials in Beijing want to know, do we have to rely utterly on Western microchips in everything from toys to weapons? Why can’t we make our own? And how about our artificial intelligence sector? Is it up to snuff with the code coming out of Silicon Valley?
Naturally, there are contrasting strategies to remedy these respective shortcomings: private entrepreneurialism with a dash of state intervention in the West (particularly America); and state intervention with a dash of private entrepreneurialism in China. The difference is, of course, that while China is stuck with the latter, the West can – if necessary – do both. (Indeed, introducing a bit more state into the innovation and productivity mix is a key part of the Dominic Cummings plan here in the UK.)
Think of the Manhattan Project or the “space race” triggered by that Sputnik 1 launch. It was not Silicon Valley that put Aldrin and Armstrong on the Moon. It was a vast US state effort.
Now, however, America’s push into space, its dominance of near-earth orbit that is every bit as strategically important as 5G, is not being led by Nasa, but by private companies that are dragging down the cost of payload delivery from tens of thousands of dollars per kilo to about a thousand. Satellite-as-a service? Amazon can help you with that.
So if the West wanted to create a Huawei in a reasonable period, it could. But it shouldn’t, because this is not truly a race. There was only one chance to be the first to have nuclear weapons, or to get to orbit, or the Moon. But whether we get 5G now or next year or even later is not truly significant. Yesterday, the Government effectively recognised this by giving Huawei 35 per cent of the noncore 5G market. As the years go by, and we catch up, expect that slice to diminish.
What’s more important is attitude, because we are going to see a lot more issues like Huawei and 5G which straddle progress, politics and national security – aforementioned satellites, silicon chips, and 5G are three, but what about renewable energy, quantum computing, or gene editing?
The West could pull out all the stops to try to stay ahead in everything, could bankrupt itself with vast state programmes, an endless series of Manhattan Projects for the modern era. Yet on everything but AI (which really is critical), to do so would be the true strategic risk. Because to do so would be to compromise the model – that combination of democratic state effort and private entrepreneurial initiative – that has proved unmatchable since Alexander Graham Bell first picked up the blower.