As Ottawa dithers, telcos shun Huawei

The federal government continues to dither over whether to allow Huawei Technologies to supply equipment for Canada’s 5G wireless network, despite an ongoing trade war with Beijing and a growing consensus among our allies that China constitutes a threat to world order. But this week, Canada’s major telecommunications companies made it clear that Ottawa’s seeming inability to make a decision is not going to slow down their plans to roll out their next- generation networks.

On Tuesday morning, on the heels of a B.C. court striking down Huawei CFO Meng Wanzhou’s attempt to have her extradition case thrown out, Bell Canada announced that Ericsson, which is based in Sweden, will provide equipment for its 5G network. The announcement came four months after the company revealed its first 5G network equipment contract with Finnish tech giant Nokia. A few hours later, Telus also disclosed that it had chosen Nokia and Ericsson to provide it with 5G networking equipment.

What was notable in the announcements was not that the telcos had chosen the two Scandinavian suppliers, but that Huawei was conspicuously absent from the list. The Telus announcement was particularly surprising because it has an existing relationship with the Chinese telecom giant, which supplied much of the equipment for its 4G network, and had previously stated that Huawei should be included.

Given that Rogers Communications announced back in 2018 that Ericsson would be used as its equipment supplier and Quebec’s Videotron is partnering with Samsung, the Chinese have been virtually shut out of this country’s next- generation networks, without Ottawa ever having to lift a finger.

The Big 3 cellular providers should be applauded for making the right decision on this file. Of course, they had every incentive to do so: given the major security concerns cited by the U. S. government and the subsequent bans on Huawei contributing to networks in the U. S., Australia and Japan, any company that included Huawei in its 5G infrastructure would face a potential backlash from customers, in the public and private sectors, and may risk their business interests in other countries.

But we should not pretend as though the Liberal government’s inaction did not play a part in these decisions, as the fact that Ottawa could ban Huawei’s involvement at any moment surely provided a disincentive for these companies to choose it as a supplier. And just because none of these companies is partnering with Huawei at the moment, doesn’t mean they won’t do so in the future. Bell has said it would consider working with the company if Ottawa allows it and Telus has not backed out of its February announcement that it would be incorporating Huawei tech into its 5G network ( likely because it would need to interface with its existing 4G network, which uses the company’s equipment).

As much as we loath the idea of the government telling private companies who they can, and cannot, do business with, Huawei is a special case because of its close ties with the Chinese government and the importance of network security in this day and age. Indeed, 5G promises to be a gamechanger because it will provide speeds that rival, and could one day greatly exceed, even the fastest consumer-grade broadband internet connections.

It will increase competition in the internet service market and provide faster speeds in rural areas. But it is in large, densely populated cities that 5G offers the greatest potential, because its higher- frequency bands, which don’t travel very far, can theoretically support speeds of up to 10 gigabits per second. This will allow more devices to gain access to high- speed internet when they are away from home or office Wi- Fi networks — everything from smart cars, to wearable tech, to communications equipment.

In an age in which large swaths of the population are working, learning, shopping and communicating online, the importance of network security has become more apparent than ever. And while the pandemic will eventually come to an end, some companies are talking about divesting some of their real estate holdings and allowing employees to work from home indefinitely, so we can expect increased levels of remote work going forward.

Given China’s history of state and industrial espionage, the close ties between Huawei and the Communist party ( its CEO is a former soldier and current party member) and laws that force Chinese companies to “support, assist and co-operate with the state intelligence work,” it would be folly to give the authoritarian regime even the potential of building a back door into networks that drive our cars, host high- level cabinet meetings and transmit government and corporate secrets.

Nor is this the first time that the Liberals have stalled on an important decision that was ultimately made by the private sector. In February, Teck Resources announced that it was abandoning its proposed $20-billion Frontier oilsands mine, after the federal Liberals dragged their feet for months over whether to approve it. The end result was bad for the economy, but saved Prime Minister Justin Trudeau from having to publicly choose between Alberta workers and his environmentalist base.

Now, this almost seems like a deliberate strategy, given that the government has once again failed to make a decision in a timely manner, which seems to have saved it, at least for the moment, from further enraging China or irking its Five Eyes intelligence partners.

In a world of increasing economic and political turmoil, we should expect our leaders to, at the very least, be able to make tough decisions and face the consequences. Unfortunately, the Trudeau Liberals seem incapable of that.