5G Technology is the future of the telecom sector. Research and development in this field have attracted global giants. But the rollout of 5G network has also caught the eyes of various governments. This is because 5G is not just a matter of cellular network but has security implications for nations and scope for dominance over the future technological era. And the latest US steps against Huawei is a testimony to this fact.

The Global 5G Conundrum

Nearly a decade ago a report by the US House Intelligence Committee flagged issues posed by Chinese telecom companies Huawei Technologies and ZTE.
This issue now has evolved into a full-scale duel between the two global technology powerhouses, which now threatens to draw in the entire world.
Soon after the US, Britain announced its ban on equipment from Huawei into the country’s high-speed wireless network.
Australia banned Huawei long back from supplying equipment for a 5G mobile network in 2018.
India along with Canada and some other countries is reviewing security implications and has yet to decide on allowing Huawei to provide equipment for them.
Meanwhile, Huawei has cut its India revenue target for 2020 by up to 50% and is laying off more than half of its staff in the country.

But before we take the geopolitics route, let us first understand the potential 5G Technology holds

5G Technology: A Perspective

In telecommunications, 5G is the fifth generation technology standard for cellular networks, which cellular phone companies began deploying worldwide since 2019, the planned successor to the 4G networks which provide connectivity to most current cellphones.

All 5G wireless devices in a cell are connected to the Internet and telephone network by radio waves through a local antenna in the cell. The main advantage of the 5G network is that it will have greater bandwidth, giving higher download speeds, eventually up to 10 gigabits per second.

5G enables a new kind of network that is designed to connect virtually everyone and everything together including machines, objects, and devices and also will make possible new applications in IoT and machine to machine areas.

The previous generations of mobile networks are 1G, 2G, 3G, and 4G:

First-generation – 1G
1980s: 1G delivered analogue voice.

Second-generation – 2G
Early 1990s: 2G introduced digital voice (e.g. CDMA- Code Division Multiple Access).

Third generation – 3G
Early 2000s: 3G brought mobile data (e.g. CDMA2000).

Fourth-generation – 4G LTE
2010s: 4G LTE ushered in the era of mobile broadband.

Benefits of 5G over 4G

1) 5G uses spectrum better than 4G

5G is also designed to get the most out of every bit of spectrum across a wide array of available spectrum regulatory paradigms and bands—from low bands below 1 GHz to mid bands from 1 GHz to 6 GHz to high bands known as millimetre wave (mmWave).

2) 5G is faster than 4G

5G can be significantly faster than 4G, delivering up to 20 Gbps peak data rates and 100+ Mbps average data rates.

3) 5G has more capacity than 4G

5G is designed to support a 100x increase in traffic capacity and network efficiency.

4) 5G has lower latency than 4G

Latency is the time a device takes to communicate with the network, which stands at an average of up to 50 milliseconds for 4G networks across the world.
5G has significantly lower latency to deliver more instantaneous, real-time access: a 10x decrease in end-to-end latency down to 1ms.

Applications of 5G technology

High-Speed mobile network: 5G will revolutionize the mobile experience with the supercharged wireless network. Compared to conventional mobile transmission technologies, voice and high-speed data can be simultaneously transferred efficiently in 5G

Entertainment and multimedia: 5G can provide 120 frames per second, high resolution and higher dynamic range video streaming without interruption. The audiovisual experience will be rewritten after the implementation of the latest technologies powered by 5G wireless. Augmented Reality and Virtual Reality services will be better experienced over 5G.

Internet of Things: IoT applications collect a huge amount of data from millions of devices and sensors and thus requires an efficient network for data collection, processing, transmission, control and real-time analytics which 5G network is a better candidate.

Smart cities: Smart city application like traffic management, Instant weather update, local area broadcasting, energy management, smart power grid, smart lighting of the street, water resource management, crowd management, emergency response etc can use a reliable 5G wireless network for its functioning.

Smart farming: 5G technology will be used for agriculture and smart farming in the future. Using smart RFID sensors and GPS technology, farmers can track the location of livestock and manage them easily. Smart sensors can be used for irrigation control, access control and energy management.

Mission-critical applications: Like telemedicine services, remote control of critical infrastructure and vehicles. It has the potential to transform industries with highly reliable, low latency link.

Back to Huawei-US tussle

The PLA’s Huawei

Started in the late 1980s by a former Deputy Regimental Chief in the People’s Liberation Army, Huawei has come a long way from being a reseller of switches imported from Hong Kong.
Huawei went on to sell its products and services in more than 170 countries, blitzing past Ericsson as the largest telecoms equipment manufacturer in the world in 2012.
It overtook Apple as the world’s second-largest manufacturer of smartphones in 2018 and had annual revenue of $122 billion and some 194,000 employees last year.

Issues with Huawei

Huawei has faced criticism for various aspects of its operations, with its most prominent controversies having involved U.S. allegations of its products containing backdoors for Chinese government espionage.
In February 2011, Huawei published an open letter to the US government denying the security concerns raised about the company or its equipment, and requesting a full investigation into its corporate operations.
In response, an investigation began in November 2011 into “the counterintelligence and security threat posed by Chinese telecommunications companies doing business in the US”.
In its report submitted in 2012, the US House panel noted that Huawei and ZTE cannot be trusted to be free of foreign state influence and thus pose a security threat.

A technological Cold War

The US Federal Communications Commission has designated these two companies as national security threats.
Thus, it blockaded Huawei on the ground that its equipment is designed to aid snooping and would make American telecoms players dependent on subsidised Chinese technology.
Most observers see this as a ‘technological cold war’ that could extend beyond just the US and China, and compel other countries, including India, to effectively choose between one camp and the other.
It is being described as a geopolitical struggle over technology that threatens to divide the world into two distinct technological blocs, with both countries striving to limit the other’s access to its advanced know-how.
The question is whether countries think the risks are high enough to dump a cheaper, viable option.
For China, the action has come at a time when 5G is set to be rolled out globally, with Huawei generally ahead in the race.

India and Huawei

In December 2019, Huawei was tentatively admitted into 5G trials in India.
As part of the trial plan, the government had decided that telecom players would be allocated special airwaves for a brief period for the 5G trials.
Huawei entered the fray with Vodafone Idea and Bharti Airtel while BSNL joined hands with ZTE.
But the 5G trials could not take off due to the Covid-19 outbreak. Then came the Chinese hostility in Ladakh that seems to have turned the tide.

Where does India stand in this battle?

Back in December 2009, the Department of Telecom (DoT) had asked Indian mobile companies to suspend deals with Chinese equipment amid fears that Chinese equipment was being used for hacking and spying.
But India has been a fence-sitter since then — and has never fully banned Chinese companies from its telecom equipment industry.
Indeed, much of India’s telecom growth story has been supported by Chinese companies in both hardware and software.

India’s concerns

India’s intelligence agencies, acting on inputs generated locally and received from other foreign agencies, have toughened their stance on two key issues – remote access and data storage.

A decision has been taken at the top level against data going outside India during the trials and Chinese vendors gaining remote access, which agencies feel will eventually land up in PLA headquarters.
Key to the security and strategic concerns is the extremely controversial China Intelligence Law legislated in 2017.
The CIL makes it mandatory for every Chinese supplier to actively share data and access to their equipment, installed anywhere in the world.
The purpose of this law is to provide a legal base for China to seek access and support from its citizens and companies for its intelligence and military activities.

Impacted by standoffs

After the standoff in Ladakh, India has asked telecom service providers to exclude Chinese companies from the scope of their network upgrade contracts.
This was part of the wider decision to signal curbs on Chinese investments and tech companies in the country in light of Atmanirbhar campaign.
In official statements, India justified the ban on 59 mobile apps with Chinese links on grounds of a threat to national security.

With the border clashes, India’s stand on this issue has got more clarity. But 5G is equally crucial for India’s future development story. For that, it has to first overcome own domestic hurdles.

Challenges for 5G roll-out in India

The Indian market has the potential to become the largest 5G consumer after China in the next 10 years.
India has nearly 45 crore handsets and 50 crore people on the internet. 5G is being seen as a game-changer for India.

These are some of the basic challenges which India needs to overcome:

Frequency allocation: Indian operators have far less spectrum in comparison to international operators. The high investment cost which makes telecom companies unsure about Return on Investment.

Pricing: The 5G spectrum is overpriced by at least 30% to 40% compared to international standards and auction in other markets such as South Korea and the U.S. In previous auctions, the government saw no takers for the 700 MHz spectrum, which is used to offer high-speed 4G services and was put on sale for the first time, mainly due to the high reserve price.

Network investment: In India, the telecom sector is facing capital augmentation issues which need to be resolved. Non-availability of funds for investment: Many of the Indian operators are also weighed down by debt.

Regulatory restrictions: Faster rounds of new technology introduction when prior technology investments have not been recouped add further complexity.

Technical Challenges: Designing IT architecture that can be deployed globally, while still allowing for localized technology to cater to different regions is a challenge. Though Reliance Inc. has some plans to roll out 5G.

Way Forward

India is keen to board the 5G bus sooner than later. The task before India’s policymakers will be ensuring that the advantages of the telecom infrastructure and related technologies support its divergent demography, economic conditions and urbanisation.

Key areas to focus need urgent emphasis are :

Reasonable spectrum pricing and swift allocation of spectrum
Policy framework enabling extensive fabrication and incentivisation to share fibre networks
Push for “Make in India” manufacturing for 5G equipment and handsets
Tailor-made 5G use cases and applications enabled through active trials
Indigenous technology advancements through R&D, and IPR development for standards, technology, spectrum, and security
Public-private partnerships for broadband growth and penetration, 5G trials and testing, network densification among others

To conclude, India cannot miss the bus

As other countries move ahead, the Indian government has repeatedly stated its intention to ‘not miss the 5G bus’ and ensure rollout by 2020, after having missed the ‘2G, 3G and 4G buses’.

A closer look, however, is required with regard to the preparedness of the industry, especially given the financial health of the telecom sector, the hesitancy among domestic banks to lend to operators, and the current pressure on tariffs.

By acting early on adoption, India can accelerate the 5G dividend and also become an innovator in applications, but it would also mean that the initial investment on equipment will be more expensive when trying to be ahead of the curve.