The article at the center of this discussion has been posted online by Business Standard – a popular free business newspaper. It covers the details of the recent decision of the United Kingdom government to ban all Huawei equipment from the country’s 5G network. The decision to prohibit the purchase of new Huawei hardware starting December 31, 2020, has been made following the famous US ban of Huawei. It seems that UK cybersecurity experts are unsure of the safety of Huawei networking devices, although no concrete evidence of backdoors or other vulnerabilities has been presented. The article adds that in spite of this, the lack of access to crucial components from the US will make it increasingly difficult for Huawei to maintain an appropriate level of security.
The article highlights several international business and marketing issues for Huawei. First, the direct financial impact of the ban is substantial. One could even argue that it would have more adverse consequences than the US sanctions, as selling networking equipment is a core element of Huawei’s strategy. As for the marketing aspect, a second major ban creates even greater damage to Huawei’s reputation. It is already challenging for the Chinese tech giant to sell its smartphones without working with Google and Qualcomm – two US companies that play a vital role in the making of almost any android device. Now, people will be even more skeptical about Huawei’s efforts to advertise their products. Furthermore, this might not be the last ban on the company’s network equipment, as other countries that plan on building 5G infrastructure will be more likely to consider changing providers. However, Huawei may be able to address this problem by negotiating with the US government, thus eliminating the source of concerns over its alleged security issues.
Britain bans Huawei from 5G network; all kit to be removed by 2027