Even as the United States, Great Britain, Australia and Japan have moved to ban Huawei Technologies from national 5G networks, Thailand has cozied up to China’s largest telecom firm, brushing aside the west’s security fears as “unproven”.
Advanced Info Service Plc. this week announced that Huawei was among five companies bidding to build the 5G core network for Thailand’s largest mobile operator. The news came just as the United Kingdom banned U.K. mobile operators from purchasing new Huawei 5G equipment and ordered them to remove what they do have by 2027.
Prime Minister Boris Johnson’s announcement reversed a January decision to allow Huawei up to a 35 percent market share in the country’s second-tier 5G networks. Johnson admitted that the ban came due to pressure from the United States, which is pressuring allies to lock out Huawei and threatening to curtail intelligence sharing with countries that don’t go along.
Thailand, a longtime U.S. ally, doesn’t seem bothered.
AIS President Hui Weng Cheong told Reuters that U.S. allegations that Huawei’s equipment could be used by Beijing for spying were “not proven” and that AIS was confident it can protect itself by putting clauses into contracts “specifying what (Huawei) shouldn’t do”.
Thailand long has had a cozy relationship with Chinese telecommunications firms. While the U.S. has banned even Huawei’s consumer handsets from American store, Thailand has given them top billing with AIS inking a new agreement this month to sell the firm’s new 5G smartphones.
AIS competitor True Plc., meanwhile, is backed by China Telecom.
Hui stressed that no decision yet has been made, explaining that AIS simply didn’t want to “pre-select” bidders and, thus, opened bidding to everyone. Competing against Huawei are Sweden’s Ericsson, Finland’s Nokia, South Korea’s Samsung and China’s ZTE, which also has been blacklisted in the U.S. as a security threat.
Renowned hacker, programmer and now Taiwan’s Digital Minister Audrey Tang said Thailand and other countries that use Chinese equipment in their core telecom infrastructure are basically inviting a “Trojan horse” into their networks.
“If you include them in the infrastructure then you have to be very careful every time you update the system, as that could make the network vulnerable to allowing a Trojan horse inside the system,” she told the Nikkei Asian Review.
Huawei, which must remain a solid Chinese corporate citizen at home yet project the image that it’s just a normal company to overseas customers, insists it is not a state-owned company and is a purely private corporation fully owned by employees. Executives assert the company is neither dependent on the Chinese Communist Party nor on the Chinese security apparatus.
“There’s no such thing as pure private companies in China,” Tang countered. “From the perspective of the PRC, the ruling party can change your leader whenever the situation is intense.”
Taiwan nearly got into bed with Huawei for its 4G network, but mass demonstrations forced Beijing-friendly former president Ma Ying-jeou to back down.
The U.S. wants its allies to do the same. In addition to the “Five Eyes” countries, most of which have now banned Huawei, France is now mulling a multiyear phase-out of Chinese telecom gear (after initially allowing Huawei to build part of its 5G network) and German Chancellor Angela Merkel is facing a lawmaker revolt over her refusal to ban Chinese 5G providers.
Even major AIS shareholder Singapore Telecommunications chose Ericsson to negotiate the provision of core and other networks, locking Huawei out of Singapore’s 5G infrastructure.
The problem with excluding Huawei for countries keen on jumping ahead in the 5G wars is that there are few good alternatives. Europe only has Ericsson and Nokia to turn to and Nokia has struggled to produce 5G chips, finally adding Broadcom as another supplier last month.
In Asia, Samsung dominated the 3G generation, but flubbed its 4G effort, never becoming a major player, and has yet to gain traction with 5G. Japan’s NEC has partnered with mobile operator Rakuten to develop a 5G network, but had not gotten beyond the demonstration stage with potential customers until the U.K. named it and Fujitsu Ltd. as alternative suppliers to Huawei.
While the U.S. has failed to produce any hard evidence that Huawei poses a greater security threat than any competing company, Chinese companies have a long history of illegally collecting data, from hiding tiny chips on Chinese-made motherboards to installing spyware in tax software of multinational audit firms.
AIS’s Hui said that, from an industry perspective, Huawei’s cybersecurity credentials are pretty solid and the cost advantage over the Europeans cannot be denied.
Unlike 4G, Thailand is ahead of its Southeast Asian neighbors in the 5G race and AIS wants to keep it that way. It holds the most 5G spectrum licenses in the country, rolled out commercial 5G services countrywide over existing 4G spectrum earlier this year and and plans to spend up to 45 billion baht this year on network infrastructure.