Huawei is being swept up in the tide of history as China turns away

In some respects this has been the case for years. Russians do not use Google but Yandex, a search engine headquartered in Moscow where it is subject to Vladimir Putin’s security laws. Likewise Chinese smartphone users have access to an array of censored and monitored versions of Facebook, Twitter and WhatsApp.

Western technology companies – software and hardware – have always been shut out of the Chinese market to a great extent. The change we are now witnessing is a response in kind, which security hawks might say is not before time. Huawei is by far the biggest loser in all of this. It had managed to break down barriers of culture and language to conquer international markets for telecoms equipment. Huawei, the global number one, has become by far China’s greatest success in the hi-tech growth markets that the politburo in Beijing aspires to take a major role in.

While it will still be able to sell its equipment in large parts of Europe, including Germany, the loss of Britain as a customer is a heavy blow. The landmark network core equipment deal Huawei signed with BT in 2005 was its international launch pad, a seal of approval that opened doors to telecoms procurement departments around the world. 

In that light it was unsurprising that China last week to warned darkly that a ban on Huawei will make it an enemy of Britain. The company will “survive and prosper”, we were assured, but it is safe to assume China will be grappling with the anger stage of grief for some time yet. The culture secretary Oliver Dowden will stand up in the Commons on Tuesday to deliver the coup de grâce in the form of a deadline for the removal of kit from “high-risk vendors” as soon as 2025.

There is no doubt this will be a serious undertaking for those telecoms operators who have come to rely on Huawei. Yet anyone who has been in or around the industry knows that warnings from executives of blackouts and slow deployment of 5G in the UK should not be received as reliable.

Such claims are issued almost boilerplate whenever telecoms operators are asked to do something they don’t want to do. Unfortunately for them, effective regulation has created an industry structure and competitive dynamics that have always meant new network technologies are deployed as soon as possible.

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