The 5G technology is going to revolutionize a number of products and services we use in our everyday lives. It will play a critical role in the advancement of artificial intelligence, smart homes, robotic surgery, autonomous cars, and more. The US government had vowed to remove Huawei from the global supply chain of 5G technologies, saying it posed a security threat. After realizing that it is nearly impossible to develop 5G standards without involving the Chinese company, Washington has amended the Huawei ban to let it work with the US companies on the technology.
The US takes a U-turn on Huawei ban
The US Department of Commerce said in a statement the policy changes don’t mean the US has softened its stance on Huawei. The changes are aimed at developing 5G standards and setting parameters for the futuristic wireless technology. Large players such as Qualcomm, Samsung, Ericsson, Huawei, and others are fighting to dominate the 5G era.
According to technology research firm GreyB Services, only six companies own a staggering 71% of the “core” 5G patents. These six companies are Huawei, Samsung, LG, Ericsson, Qualcomm, and Nokia. Huawei has the most 5G patents, and only one of the six companies (Qualcomm) is American. It’s too early to say which company will lead the 5G race.
Given Huawei is one of the most dominant players, it was only a matter of time before the Trump Administration realized its importance. Trump had banned the sale of chips made using US technologies to Huawei. GreyB Services director Deepak Syal told Bloomberg that even if the US hired other companies to build out the 5G network infrastructure, they would still have to pay Huawei for patent licenses.
Hurting Huawei’s growth ambitions
The ban imposed by the US government on Huawei has hurt the Chinese company’s growth in international markets. The Trump Administration had also asked European countries to ditch Huawei and use Western technologies for building their 5G infrastructure. The British government is also excluding Huawei from its 5G plans.
Taiwan-based TSMC has decided to set up a manufacturing facility in Arizona to address the US government’s concerns. TSMC makes chips for both Apple and Huawei.
But setting up the 5G standards without Huawei wasn’t realistic. When a new technology emerges, companies come together to set up a standard. They agree to license one another’s patents on fair and non-discriminatory terms.