Italy and UK probe Huawei, Turkcell leaps to its defense

The news – real and rumoured – continues to mount up around Huawei and its troubled relations with western governments. In the past week, local press reports in Italy suggested that country might be the latest to toe the US line and bar Chinese vendors from critical infrastructure projects, notably 5G.

Telecom Italia (TIM) has previously said it would continue to work with Huawei or ZTE unless the government told it otherwise. But the La Stampa newspaper reports that the Ministries of Defense and of Foreign Affairs are preparing to leverage so-called ‘Golden Powers’ – which allow governments to enforce certain actions – to introduce a ban on the vendors and to allow telcos to exit existing contracts without paying compensation.

However, Italy’s Ministry of Economic Development denied the reports and said there was currently no proof of risks to national security. “With reference to press articles on alleged banning of Huawei and ZTE companies from Italy in view of the adoption of 5G technology, the Ministry of Economic Development denies its intentions to take any initiative in this regard,” it said.

But Italy is sure to feel the pressure from the USA. A US State Department official said its government is talking to its European allies, “urging folks not to rush ahead and sign contracts with untrusted suppliers from countries like China,” according to news agency Reuters.

The Reuters source said that Washington will use multiple tactics to restrict Huawei in Europe, including lobbying allies in the NATO Alliance and at the upcoming Mobile World Congress (where several debates about the China situation are supposedly slated within the Ministerial Program, and where Huawei will no doubt be putting its own case strongly to its customers).

The US government argues that, if the networks of its European security allies are compromised, that could affect its own security.

But Huawei has promised to spend $2bn over the next five years on improving its software engineering capabilities to address security concerns. Its promise was addressed specifically to the UK, and took the form of a letter from Ryan Ding, president of Huawei’s carrier business group, to the UK Parliament’s House of Commons Science and Technology Committee. Last summer, a UK security watchdog, the Huawei Cyber Security Evaluation Centre (HCSEC), warned of some shortcomings in Huawei’s engineering processes which could lead to security risks. Press reports suggest that a follow-up report by HCSEC will say that these concerns have not all been addressed.

Among other problems, Huawei was criticized for using third party software that was “not subject to sufficient control”.

Ryan acknowledged in his letter that Huawei’s software engineering “has room for improvement” but said making changes would be a “complicated and involved process” that could take three to five years. “We hope the UK government can understand this,” he wrote.

The UK has not imposed any bans on Huawei although incumbent BT is taking the vendor’s equipment out of the core network of its mobile subsidiary EE. But BT has also championed Huawei’s 5G RAN kit, and Three UK, a Huawei customer, has warned that a a ban would increase the cost and time to deploy 5G in the country.

Another operator supporting Huawei and calling on governments to leave operators to choose their own suppliers is Turkcell. The Turkish operator’s CEO, Kaan Terzioglu, said there were no plans to replace the vendor. “It wouldn’t be right to evaluate Huawei’s current situation by ignoring the competition in the smartphone market and the conflict of which company will lead 5G,” he said. “No one should expect us to act on uncorroborated claims. Turkcell will continue to work with its long time business partner Huawei.”

Huawei had a big role in Turkcell’s 4G build-out and last month the MNO said it had “verified” a new 5G base station from the Chinese supplier on a commercial network. It recently signed a memorandum of understanding with Huawei covering the roll-out of a “basic” 5G network, among other things.