UK Broadband ISP Networks Facing Huge Risk from Huawei Fallout UPDATE

Concerns are growing that many consumers, broadband ISPs and mobile operators in the United Kingdom could be impacted much more severely than first thought after the President of the USA, Donald J. Trump, signed an executive order to “prohibit transactions posing an unacceptable risk to the national security of the USA.”

At first glance you may well wonder how Trump’s decision, which directly hit companies like Huawei (i.e. an effective ban due to the present security concerns), could impact the UK. The answer stems from a matter which is often overlooked by the casual observer (it’s a similar story in the Brexit debate), that of the complicated and deeply rooted global supply chain for technologies and patents.

When you buy a broadband router, Smartphone, core network kit or some other piece of hardware from a major company like Huawei then you’re not purchasing something that 100% originates in China. The hardware you purchase is in fact made up of many different components and these are manufactured all over the world. Likewise those components also have patents, many of which can be traced back to the USA.

Complex Supply Chain

The problem this creates was starkly illustrated after British CPU firm, ARM, announced earlier this week that it was ordering all of its employees and contractors to cease work on “all active contracts, support entitlements, and any pending engagements” with Huawei. Since then we’ve seen similar moves or preparations by Broadcom, Intel, Qualcomm, Xilinx and Panasonic. All sell bits and pieces to the Chinese giant.

Likewise Google has already pulled some of the support it can provide for the Android OS software used by Huawei’s Smartphones, which is ironically a decision that seems to be counter-intuitive as a loss of support could leave consumers who own such devices at a huge disadvantage (e.g. loss of future feature updates and possible some future security patches).

A Spokesperson for Huawei said:

“We value our close relationships with our partners, but recognise the pressure some of them are under, as a result of politically motivated decisions. We are confident this regrettable situation can be resolved and our priority remains to continue to deliver world-class technology and products to our customers around the world.”

In one fell swoop Trump hasn’t just hit Huawei smack in the balls, he’s also screwed up a hugely complicated global supply chain (threatening jobs and economic growth across a whole sector in the process) and potentially made millions of consumers less secure in the process. Nice, thanks Donald.

Just to be clear, none of the companies in this complex supply chain want to stop working with Huawei, but equally many have even bigger customers and legal considerations in the western side of the world (particularly the USA) and those will take precedence.

Huawei’s Nuclear Fallout

Before all this the only concern that Huawei and its supporters in the UK telecoms sector had, which includes many of the markets major operators (Openreach, BT, EE, Vodafone etc.), was whether or not the UK Government would carry forward their preliminary decision to ban the firm from supplying core networks (non-core kit would be left alone). Further context here.

At the time the Government’s position was a huge issue, but fast forward a few weeks and it now seems more akin to a small hill against a veritable mountain of Chernobyl fallout (side note – that’s an excellent TV series!). Whether or not the UK now chooses to completely ban Huawei may thus become a moot point because a decision in the USA has effectively stopped a mass of key businesses across the world from working with the company.

Huawei’s kit can be found all over the place in modern broadband and mobile networks. You’ll see it in Smartphones, you’ll see it in Openreach’s street cabinets and in consumer routers. Now imagine what happens when the company that supplies so much of that struggles to provide the necessary on-going and future support (replacement kit, updates, new features etc.).

Huawei has been dealt a colossal hammer blow and in turn many of those who have come to rely upon or enjoy their products will also end up suffering. We did ask Openreach and other ISPs to give us their comment on a this but, perhaps for obvious reasons (everybody is still assessing the potential damage), none responded. However the UK ISP Association (ISPA) and Government (DCMS) were kind enough to reply.

A Government Spokesperson told ISPreview.co.uk:

“The security and resilience of the UK’s telecoms networks is of paramount importance.

The Government has undertaken a thorough, evidence-based and hard-headed review of the 5G supply chain to ensure the secure and resilient roll-out of 5G. It will report in due course, and to Parliament first.

The UK is not considering any options that would put at risk our national security communications, within the UK and with our closest allies.”

A Spokesperson for the ISPA said:

“ISPA and its members are aware of the current focus on the telecoms supply chain, including the DCMS’ ongoing Telecoms Supply Chain Review. ISPs will continue to follow this dynamic area as events unfold. It is important to stress that there are a diverse range of suppliers within the UK’s fixed broadband network that underpin a competitive and interconnected market.”

You’ll note that in this article we haven’t touched on the key security fears that surround Huawei and are the trigger for all this (see our other links above for context). One reason for this is that such issues are a matter for the national security and intelligence agencies (secret), which is virtually impossible for ordinary folk to judge. We wouldn’t be so bold as to assume we know better than they.

Furthermore it seems unlikely that so many countries would be creating such a fuss if there wasn’t a serious concern. On the other hand screwing up a global supply chain so aggressively and damaging masses of consumer products in the process, many of which we all own (sometimes without even realising it), is perhaps not the right outcome. Putting it mildly.

Donald J. Trump said:

“Huawei is something that is very dangerous. You look at what they’ve done from a security standpoint, a military standpoint. Very dangerous.”

Meanwhile, short of finding a solution, Huawei will have to find a way to produce some of their products using different non-USA linked components and patents, which could make what they have to offer seem less competitive. Quietly there may be some companies, particularly a few of their arch rivals, who will be celebrating moves to neuter one of their biggest competitors.

However many of those same companies will also have to be wary about the precedent this sets, which could see a similar approach being used against their own products in the future (e.g. Apple, Tesla etc.). This is why, until now, most political leaders have been super-careful with their approach. It’s almost like there’s a trade war going on.. oh wait.

“If we made a deal, I could imagine Huawei being possibly included in some form or some part of it,” said Trump.

UPDATE 1st July 2019

Perhaps predictably, Trump has opted to relax his Huawei ban as part of the USA’s on-going trade negotiations with China (here).