How important is Huawei for the 5G industry? (Analyst Angle)

Huawei’s success and market evolution are a contested topic nowadays, with critics arguing that the vendor is a front for the Chinese government, while several telco operators claim the Chinese vendor is continuously innovating in the industry and setting a new standard for client support. It is important to note that most criticism is not coming from clients, partners, or even competitors, but from government bodies, national security organisations, and regulators, to a certain extent. The line between these two opposite arguments represents a very delicate balance, which currently depends on many critical issues, including the geopolitical trade war, existing vendor relationships, and 5G market conditions. This discussion is also distorted by disinformation from both sides, making a clear conclusion about these topics very difficult.

Regardless, Huawei has been a technology powerhouse for 4G and 5G, and has arguably advanced capabilities in both technology development, but most importantly, in the implementation of these networks. Huawei is among the top contributors in The 3rd Generation Partnership Project (3GPP) meetings and one of the biggest patent holders for 4G and 5G. But the implementation of these networks is currently more important and Huawei has illustrated its expertise, professionalism, and collaborative approach in several cases:

• Huawei developed the SingleRAN concept in 2007 in a joint innovation lab with Vodafone. This concept breaks a cellular base station down to a Baseband Unit (BBU) that is placed at the bottom of the tower and the Radio Remote Unit (RRU) that is placed next to the antenna. Previously, both the baseband and radio units were at the bottom of the tower and Radio Frequency (RF) cables were used to connect them to the antennas. This led to very high cabling costs and signal loss, and power inefficiencies. On the other hand, SingleRAN offered the capability to pool baseband resources for many generations, including 2G, 3G, and 4G, at the time and is now an industry standard and offered by all vendors. 
• Huawei pioneered the CloudAIR concept in November 2017, which allowed spectrum sharing between 4G and 5G systems. This is very similar to the Dynamic Spectrum Sharing (DSS) concept that is now being commercialized in 5G deployments. Huawei was not the only company developing this and many 3GPP participants arguably contributed to the commercial development of DSS, but it could be said that Huawei was one of the first to identify the need for spectrum sharing between cellular generations.
• Huawei also announced a 64T64R Massive Multiple Input, Multiple Output (MIMO) Active Antenna Unit (AAU) that supports 400 Megahertz (MHz) of bandwidth in the 3.5 Gigahertz (GHz) band, pushing the limit of RF components, power amplifiers, and system design. This AAU has been designed to support mobile operators that own non-continuous 5G spectrum in this band. There may not be several operators in the market in this situation, but this is another indication that Huawei is continuously trying to address customer requirements.
• Huawei has also been the only vendor to have developed both Narrowband Internet of Things (NB-IoT) network capabilities and chipset/devices from early commercialization phases, bringing cellular IoT features to several enterprise verticals.

These innovations are just a few examples of Huawei’s new products and solutions, and the vendor reports having many more initiatives in the pipeline in both technology and implementation areas. This illustrates that Huawei is an important company in the development of 5G technology and network deployments, including consumer-based outdoor networks, as well as enterprise applications. Banning Huawei from the global domain will not only restrict operator choice in terms of vendors and potentially force them to rely on a duopoly or even a monopoly, but it will also dampen technology innovation throughout the entire industry value chain.

Editor’s note: This piece is adapted from the report, “What is the real cost of removing Huawei?” 

About Dimitris Mavrakis:
Dimitris Mavrakis, Research Director, manages ABI Research’s telco network coverage, including telco cloud platforms, digital transformation, and mobile network infrastructure. Research topics include AI and machine learning technologies, telco software and applications, network operating systems, SDN, NFV, LTE diversity, and 5G.

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