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How The World Is Preparing For 5G

Team SNI New Delhi 8 August 2019

As India explores its 5G options, how is the rest of the world moving? Briefly, Huawei has little or no role in China while in the UK it has wide acceptance in telecom networks. Europe is looking at how to restrict Chinese companies in the core 5G networks while Japan has excluded Chinese firms altogether. Here’s a look at some key countries and their 5G plans.

 

China

The preliminary phase of 5G deployment in Beijing and Shenzhen has begun with ample number of base stations to support trials. Commercial 5G licences are expected to be issued by the Ministry of Industry & Information Technology late this year or early next.

The Chinese government plans to deploy the 5G network through three state-owned telecom operators: China Mobile, China Unicorn and China Telecom, all of whom were awarded 5G spectrum licences late last year to conduct trials for the new mobile system before its rollout. Curiously, Huawei has not won any of the 5G commercial contracts in mainland China; it has only one contract in Hong Kong. It appears that China Mobile, China Unicorn and China Telecom will be depending on European companies Ericsson and Nokia that have reportedly signed contracts with the operators.

The United States banning Huawei is not therefore expected to hit China’s 5G rollout plans. Rather, as some Chinese reports suggest, the 5G plans will benefit from international cooperation.

Japan:

The Ministry of Internal Affairs & Communications recently issued spectrum for 5G services to three network operators—NTT Docomo, KDDI, Softbank—and the startup Rakuten, which is evolving from its leading role in e-commerce to wireless telecom. All four have committed to building nationwide 5G networks by 2022 and are investing more than $14 billion towards that end over five years. The country is being divided into 4500 blocks with the operators being required to provide 5G services in half of them.

Chinese firms Huawei and ZTE are effectively banned from 5G with the four operators signing on to the ban. Ironically, Softbank will have to replace its Huawei equipment while NTT Docomo which used Huawei equipment for trials has now switched to Nokia. The operators are also under pressure to cut prices for consumers; this is where new entrant Rakuten could have the advantage. It plans to launch a cloud based 4G LTE service later this year followed by 5G next year.

More interesting is the fact that Japan is already looking beyond 5G. Researchers at Tokyo’s Waseda University are joining hands with the University of Stuttgart, electronics maker NEC and Deutsche Telekom to utilize the 300 gigahertz frequency band, boosting data transfer speeds ten-fold. Funding for the project is coming from EU’s research and innovation programme Horizon and the Japanese government’s National Institute of Information & Communications Technology.

There’s also an India angle. The Japanese and Indian governments have joined hands and have agreed in principle to work together on measures to combat cyber attacks related to the development of 5G technology. The Japanese appear particularly concerned with Huawei equipment and have issued guidelines to ensure it is not procured.

European Union:

The EU is likely to accord utmost priority to cyber security concerns despite the 5G joint declaration with China agreed on at the summit in Brussels in April. Therefore, keeping in mind the general security concerns associated with products of Huawei and ZTE, reliance at this moment is likely to be placed on companies based in Europe for 5G roll out.

But many countries may give priority to the cost factor. Italy may have a soft approach to Huawei in rolling out its 5G telecom network, as indicated by Prime Minister Guiseppe Conte to the Huawei CEO in April. Italy is the only G-7 country to sign on to the BRI/OBOR in January. Other EU member states who could be influenced by the Chinese company are Albania, Bulgaria, Croatia, Hungary, Czech Republic, Estonia, Latvia, Slovenia, Poland and Lithuania.

Belgium is likely to toe the EU line reference security concerns on 5G rollout. Proximus, one of the key service providers, is controlled by the government and will be an active player in 5G rollout with other EU suppliers.

France:

5G launch is planned for 2020 with all cities covered by 2025. Currently, 5G trials are underway in 45 cities and towns all across France including Paris, Lyon, Marseille and Bordeaux. Auction of spectrum is expected to take place later this year and, according to reports in the French press, could comprise a mix of sale to the highest bidder and some spectrum being given directly to the telecom operator. Local telecom regulator Arcep will be responsible for allocation of spectrum and is also developing the massive framework that 5G networks require.

Infrastructure for 5G networks will be done in public-private partnership mode with the Directorate General for Enterprise getting the funds together for trials and R&D projects. It will also coordinate the 5G roadmap action plan. The buzz is 5G will be rolled out in two stages: first by optimising existing networks for mobile technologies and then by launching new services with a suitable economic model. It is expected that 5G will generate $300 billion in revenues for mobile operators by 2025.

Arcep has already held public consultation on the terms and conditions for the release and use of the 3.5 gigahertz, 26 gigahertz and 1.4 gigahertz bands. The aim is to allocate all frequencies and complete commercial rollout in at least one major city by 2020 and cover all transport routes by 2025.

Lacroix, an international technology equipment supplier, is teaming up with telecom company Orange to provide an indoor network to test ambient connectivity on the industrial site. Orange is also working with Schneider Electric to evaluate the possibility of using 5G in industrial production processes. Then auto maker Renault, telecom major Ericsson and Orange plan to work together on connected vehicles and 5G to assess the capacity of 5G to enrich communications between vehicles and their environment.

On the key question of security, French ministers say the choice of 5G telecom equipment manufacturers will be made in relation to network security and performance, adding that no candidate will be excluded (although Ericsson is being considered as an alternative to Huawei). The French government is clear that it does not want to ban any actor but would prefer greater control over equipment used. This includes a validation process to ensure a diverse range of equipment is used in the network with the proviso that the same equipment cannot be used in the same zone. This is to avoid “a significant risk of black out in case of cyber attack against mobile networks”.

Among the main areas of concern to the French authorities are:

  • Sovereignty—In the era of edge and cloud computing, virtualised infrastructures are becoming increasingly important to operators. Storage and processing of data are not subject to any regulatory framework that poses risk of dependence and vulnerability.
  • Security—Entire business sectors will be dependent on the network’s availability, providing hackers with a new playing field.
  • Shutting down whole network—Equipment manufacturer can insert a backdoor into the computer code to shut down the computer network remotely.
  • Spying on data—Equipment manufacturers may spy on data transiting through their products. However, operators retain at all times visibility over the data entering or leaving their core network (even if the core network is decentralized as is the case with 5G). They can therefore see any data leaks in their equipment. Given this, France wants to develop tools to monitor data flows through their network equipment.

As regards the Chinese firm Huawei, there is a middle approach. France may not allow that company’s equipment as part of its core infrastructure. Huawei may be limited to supplying antennas etc. Siemens and Ericsson may be tapped to work on the core infrastructure of 5G since their services will be cheaper than those offered by American companies.

Germany:

5G strategy launched in 2016 with 5G research centres established in 13 German cities. Berlin, Dresden and Munich are the most important. Free frequencies for 5G operation are limited so the Federal Network Agency is carrying out an auction to ensure easy availability of frequency and to enable rapid and needs based roll out of 5G.

Forty-one blocks of spectrum are on offer in 2 gigahertz and 3.6 gigahertz band. Four companies were admitted into the auction: 1&1, Telefonica Germany, Telekom Germany and Vodafone. Additional frequencies in the range of 3.7-3.8 gigahertz and 26 gigahertz for local use will be provided in a separate application process. The Federal Network wants to ensure that companies can set up autonomous networks, for example on factory grounds, to network their machines. So far there have been 389 bidding rounds with total bids amounting to 5.9 billion Euro.

All four telecom companies mentioned above have been working with Huawei products and plan to continue doing so even with 5G. Once auctions are complete, Huawei is expected to play a key role in building Germany’s 5G network. If Huawei is banned, it would delay the rollout of the network.

Draft new security guidelines released in March remain under consultation with industry and government branches. The draft says equipment can only be bought from trustworthy vendors “which unequivocally abide by national security regulations as well as provisions in the secrecy of telecommunications”. Security related components may be used for network expansion if they have undergone IT security checks by an approved testing body and have been certified by the BSI (Federal Office for Security in Information Technology).

Huawei has set up a laboratory in Bonn to check security of systems. BSI says Huawei’s system and network elements are safe and reliable with no threats identified. But questions have been raised about BSI being in a position to conduct tests or check the safety of developing networks. Testing in laboratories requires a high level of expertise which BSI does not appear to have. Huawei has offered the German IT Ministry a look at its source codes to build trust. But data security experts say BSI is unlikely to be able to detect whether or not data is being siphoned back to China.

Germany is taking a stand independent of the U.S. and other countries for its own political and economic considerations. This despite the foreign office and external and internal intelligence services advising against the installation of systems and network elements of Huawei and ZTE in critical infrastructure.

The president of the Federal Network Agency said he had “received no concrete evidence against Huawei nor are we aware that any other authority in Germany has received any reliable information”. Another expert said it was not possible to carry out classical industry espionage over mobile communication networks because of “end to end encryption”.

Huawei is deeply entrenched in the German telecom market for many years. It has many years of partnership with Deutsche Telekom, which vouches for its products and professionalism. Huawei is a private, not a state-owned company. Huawei is strongly represented in all the networks. Half of Vodafone’s equipment is from Huawei. The Chinese firm has expanded parts of networks in Germany and handed them over to operators who say Huawei has no access to them.

Germany has proposed inspection of Huawei equipment. BSI says tougher vetting procedures including certification of all hardware and software would help manage the risks. The Interior Ministry wants a “trust clause” to the telecom law. Another option is to keep Huawei out of the core 5G network, which is also what France is planning. For now, the German government is looking at framing administrative regulations for testing equipment security.

Banning Huawei would be a big political decision for Germany, one which only the Chancellor can take. Before going down that road, Germany will consult all European partners. Informal talks between Germany, France and the UK have been underway to align their positions.

United Kingdom:

The British government has cleared the procurement of Huawei telecom equipment by Vodafone, BT, Virgin and EE. All have announced plans for a limited 5G release this year followed by full rollout by 2021. All the British telecom majors are heavily dependent on Huawei for supply of critical hardware, technology and investment and even today are using a range of Huawei equipment for their existing 4G networks.

U.S. pressure forced the British government to move, so the National Cyber Security Centre opened a dialogue with Huawei and ZTE that related to a security-linked examination of their equipment and plugging of any backdoor. In December last year, Huawei said it had accepted various recommendations made by the centre to address risk concerns but even today there is caution about Huawei and ZTE equipment.

In its annual report released this year, the oversight board of the Huawei Cyber Security Evaluation Centre said it could only provide limited assurances on the long-term security risks posed by the participation of Huawei in the UK’s telecom networks. Concerns have been raised about the absence of “tunneling protocol for the transmission of encrypted data” and the use of mobile edge computing technology which enables information processing at the base station and makes communication data vulnerable to extraction.

Currently the British government is trying to keep under wraps its policy on Huawei. It’s not clear if Huawei can be restricted to a “non-core” role in the 5G network and thereby help the UK meet U.S. demands on keeping the Chinese out. Reports indicate the British government is working on how to restrict Huawei’s role in base stations and encryption.

Israel:

Bids for 5G frequencies were launched last month with the expectation that these will be finalised by the end of this year. Formal launch of 5G services is expected in the 2020-23 time frame. As always, local innovation is expected to drive 5G with the formation of a consortium HERON for developing the building blocks of 5G mobile technology. Three major areas have been identified: Network E2E architecture, RAN innovative network solutions and essential 5G engines and its optimisation.

A public-private partnership will support the ambitious Internet of Radio Light project, which is basically a communication system using light, overcoming many of the difficulties of the current Wi-Fi system. Also referred to as Li-Fi, one could navigate with a throughput of more than 10 GBPS, consuming less energy and guaranteeing better safety and localisation.

An Israeli company RunEL has developed the Sparq-2020 system on chip for 5G cellular network base stations. It is optimised for ultra-reliable, low-latency communication applications such as V2X, connected car, drone communications, remote surgery and so on. Israel has the advantage of being the manufacturing base of leading multinationals like Intel that are working on 5G mobile technology.

There is concern over the activities of Chinese companies, so the Defence Ministry and security agencies are on the job. So far no Chinese company has ever won a contract to supply core network equipment to any Israeli telecom service provider. Huawei and ZTE only sell smart phones and terminal equipment in Israel.

It is expected that Israel will continue its undeclared policy of not using core equipment made by Huawei and ZTE or any other Chinese company in its telecom service provider networks.

Singapore:

Plans to launch 5G late next year with limited coverage and in phases are under way. The government is currently focused on getting the framework ready with public consultations having been completed and feedback being sought from industry by the Media Development Authority, which will function as the regulator.

Singapore is looking at a standalone network unlike many other countries that plan to piggyback on their existing 4G networks. Standalone networks will be more expensive as a new network core has to be deployed. The government also understands that the cost of deploying 5G infrastructure will be two to three times more than 4G networks and is encouraging mobile virtual network operators and offering free spectrum ranges. This is to ensure a level playing field for small network operators and quantity will not be compromised due to the high cost base. Network operators are being encouraged to form partnerships in building the 5G ecosystem so as to more effectively use scarce spectrum and speed up deployment.

The Media Development Authority is issuing a “call for proposal” instead of an auction to assign 5G spectrum. Besides offer price, it will also evaluate a bidder’s quality of network design, resilience and financial capability. This will be completed by the year-end. Currently, Singtel, StartHub and M1 mobile network operators are testing 5G applications.

On security, Singapore is unlikely to follow the U.S. and Australia and ban Huawei and ZTE. The Media Development Authority says vendor diversity will mitigate risks from dependency on any one vendor. It says it will independently test Huawei equipment to analyse their risk. It is working closely with the Cyber Security Agency of Singapore to ensure that telecom networks are secure.

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