Len­ovo re­buts ru­mor it failed to back Huawei on 5G is­sues

China Daily - - TOP NEWS - By MA SI and CHENG YU Con­tact the writ­ers at masi@chi­nadaily.com.cn

Chi­nese com­puter maker Len­ovo Group is­sued an in­ter­nal let­ter on Wed­nes­day re­but­ting the mar­ket ru­mor that it failed to back Chi­nese tele­com com­pany Huawei in set­ting global stan­dards for the fifth gen­er­a­tion mo­bile com­mu­ni­ca­tions tech­nol­ogy.

The move came amid in­ten­si­fied com­pe­ti­tion among coun­tries for a big­ger say in de­vel­op­ing 5G ser­vice. The first ver­sion of stan­dards is ex­pected to come out next month, lay­ing a foun­da­tion for global com­pa­nies to be­gin build­ing large-scale 5G net­works.

Len­ovo founder Liu Chuanzhi said in the let­ter the com­pany backed tech gi­ant Huawei’s pro­pos­als for 5G stan­dards in the fi­nal round of vot­ing. “Chi­nese busi­nesses should unite and brush aside at­tempts to sow dis­cord,” Liu added.

His com­ments came amid the mar­ket ru­mor that Len­ovo voted in fa­vor of the United States tech com­pany Qual­comm against Huawei re­gard­ing a key tech­nol­ogy stan­dard for 5G. The new, su­per­fast tech­nol­ogy will al­low con­sumers to down­load an 8-gi­ga­bit movie in sec­onds and have ac­cess to ser­vices like au­ton­o­mous cars and re­mote surgery.

In­dus­try an­a­lysts say the dis­pute high­lights how im­por­tant it is to gain greater say in fi­nal­iz­ing 5G stan­dards, as economies scram­ble for a beach­head.

On Thurs­day, the Min­istry of In­dus­try and In­for­ma­tion Tech­nol­ogy, China’s top in­dus­try reg­u­la­tor, and the Sta­te­owned As­sets Su­per­vi­sion and Ad­min­is­tra­tion Com­mis­sion launched a guide­line to ac­cel­er­ate steps to pro­mote 5G and its ap­pli­ca­tion in in­dus­tries.

“This year, China will pro­mote key tele­com pro­grams, in­clud­ing fin­ish­ing third-phase tests on 5G,” the guide­line said.

“The more tech­ni­cal pro­pos­als for 5G rec­og­nized by the global tech com­mu­nity, the faster a coun­try can build a large-scale net­work for the su­per­fast tech­nol­ogy,” said Xiang Li­gang, a tele­com ex­pert and CEO of the tele­com in­dus­try web­site Cc­time.

The for­mu­la­tion of global 5G stan­dards de­pends largely on com­pe­ti­tion among China, the US and Europe, he said. As do­mes­tic com­pa­nies like Huawei and China Mo­bile evolve into pioneers in the tele­com arena, China is likely to play a more sig­nif­i­cant role.

The Chi­nese gov­ern­ment at­taches high im­por­tance to 5G, which will also spark a faster roll­out, Xiang added.

The coun­try has al­ready had a string of achieve­ments in 5G. Last year, China Mo­bile out­gunned for­eign ri­vals to lead the global 5G Sys­tem Ar­chi­tec­ture project, which will de­ter­mine 5G net­works’ struc­ture.

The na­tion also es­tab­lished the world’s largest 5G test field in Bei­jing’s Huairou district, where do­mes­tic firms and a string of for­eign tech com­pa­nies are par­tic­i­pat­ing in China’s third phase of 5G tests.

China lagged be­hind other coun­tries in build­ing 4G and 3G net­works. But with 5G, it is rac­ing ahead in re­search and de­vel­op­ment, as well as trial ap­pli­ca­tions, said Wang Zhiqin, vice-pres­i­dent of the China Academy of In­for­ma­tion and Com­mu­ni­ca­tions Tech­nol­ogy.

The coun­try is likely to is­sue 5G li­censes to tele­com car­ri­ers in the sec­ond half of next year at the ear­li­est and will be among the first to is­sue 5G li­censes in the world, she said.

The mar­ket size of China’s 5G in­dus­try is ex­pected to reach 1.15 tril­lion yuan ($180.6 bil­lion) by 2026, 50 per­cent higher than its 4G mar­ket, ac­cord­ing to CCID Con­sult­ing.

ON WED­NES­DAY, Len­ovo pub­lished an open let­ter ad­dressed to its em­ploy­ees call­ing on them “to win the bat­tle for Len­ovo’s honor”. Bei­jing News com­ments:

The let­ter came be­cause the com­pany has been heav­ily crit­i­cized on so­cial me­dia be­cause two years ago, 3GPP, the telecom­mu­ni­ca­tions in­dus­try au­thor­ity, or­ga­nized a vote on the 5G stan­dards and Len­ovo voted for Qual­comm’s pro­posal in­stead of Huawei’s in the first round of vot­ing.

As the let­ter pointed out, th­ese were purely tech­ni­cal dis­cus­sions. And while it ini­tially voted in line with the tech­nol­ogy and patent re­serves it al­ready had, in the sec­ond round it voted in con­sid­er­a­tion of the over­all de­vel­op­ment of the in­dus­try in China.

Huawei it­self has is­sued a state­ment, say­ing that at the 2016 con­fer­ence, Len­ovo and its Mo­torola mo­bile voted in fa­vor of Huawei’s pro­posal in the sec­ond round of vot­ing.

But be­cause Len­ovo ini­tially voted in fa­vor of a tech­ni­cal scheme that was dom­i­nated by Qual­comm, it is now be­ing ac­cused of be­ing a traitor to the coun­try.

Yet it is nor­mal for en­ter­prises in different coun­tries to get to­gether to de­ter­mine the tech­ni­cal stan­dards for in­dus­try through dis­cus­sions. It shows that, like in­ter­na­tional trade, this mat­ter is es­sen­tially of mu­tual ben­e­fit. The dif­fer­ence is only, who wins more, who wins less.

That is also the case for 5G tech­nol­ogy. The com­pe­ti­tion among different pro­pos­als is there­fore nat­u­ral and com­pa­nies will tend to pro­mote the ones they think will ben­e­fit them the most.

Al­though Len­ovo has ev­ery right to re­sort to le­gal means to de­fend its rep­u­ta­tion, in this age of glob­al­iza­tion, the in­ter­ests of en­ter­prises of different coun­tries are in­ter­twined. And at a time when a grow­ing num­ber of Chi­nese en­ter­prises are multi­na­tion­als, do­mes­tic pub­lic opin­ion should be more ra­tio­nal, and re­spect the prin­ci­ple of co­op­er­a­tion for mu­tual ben­e­fits.

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