For months, we have heard a man from overseas raising the alarm that Chinese producers of 5G telecommunications equipment (Suppliers5G) will start to eavesdrop on us en masse, and urge US coalition partners to boycott technology from China. I have listened to many statements on this issue from officials, competing suppliers, journalists, operators, and finally independent experts.
There are many understatements and generalizations in the sea of information on this topic. I decided to take a look at the topic and analyze it from the perspective of operator experience.
Let us clarify who the Suppliers5G are and which of them is good and which is not good in the history of this Lord, i.e. which supplier has no connection with China.
There are currently five major Suppliers5G of RAN equipment on the market: Ericsson, Huawei, Nokia, Zte, and Samsung. These are not all Suppliers5, which will be discussed next. RAN equipment from European, i.e. from Ericsson and Nokia, but also Korean Samsung, are the “good” ones, i.e. considered safe. The most interesting thing, however, is that the hardware of these companies is also often produced in China. Components, and software also often come from China.
In the case of the 5G revolution, the radio network is not the only issue. The introduction of solutions based on software, and not only dedicated processors, requires the use of servers. Of course, the most popular are servers, which are also manufactured and assembled in China. So many suppliers do it because we know that Chinese “assembly plants” are cheaper. They have mastered the production processes almost to perfection.
The servers are equipped with Intel processors. The most popular today, and these are produced only in a few cities in the world. Oregon, Arizona, New Mexico, Ireland, Israel, and Dalian, a city in China. Intel processors are tested and packaged only in Asian cities: Chengdu (China), Vietnam (Vietnam), and Penang Kulim (Malaysia). Hmm, China is coming again.
As you can see, it is not possible, to specify which supplier is not related to Chinese telecommunications producers. On the contrary, you can find the% share of Chinese technology in each supplier.
Who actually eavesdrops on whom and how the end-user influences it, that is, the proverbial “John”.
Before we start looking for spies in China, let’s recall what Snowden announced to the world a few years ago. He disclosed information that GAFA (Google Amazon Facebook Apple) collects data about all users in the world. What is worse, they transfer it to investigative institutions from the USA. In addition to location, SMS, Internet calls, and voice calls, they also create behavioral customer profiles. The users of these systems are psychologically profiled, and the US special services have access to this information. Isn’t that permanent and direct surveillance?
Where are Chinese suppliers going?
Should we then clear China of suspicion? Probably not, just as you cannot not be afraid of Iran, North Korea, and Russia. They eavesdrop and spy on all countries, but not all countries are global providers of telecommunications solutions, and this is the catch. The USA, China, and Europe are places where telecommunications infrastructure is built, and the risk as seen by the US is increasingly affecting the economy.
One of the pieces of evidence of China’s spying in the telecommunications world was reportedly the discovery of small, on-board microprocessors from SuperMicro, which were supposed to eavesdrop on server owners by sending traffic to servers in China. The company SuperMicro is a manufacturer based in the USA and this was founded by the Taiwanese Charles Liang. Interesting. By the way, Android and IOS smartphones do exactly the same.
None of these elements of the “spy game” is influenced by ordinary Kowalski, unless he stops using smartphones, but that’s probably not possible anymore, right?
Let’s look at the issue of choosing a Suppliers5G from the operator’s perspective, i.e. the buyer of the hardware/software.
Operators in Poland have been using 2G/3G/4G equipment from Chinese companies Huawei and ZTE for many years. The purchase of this equipment over the years costs hundreds of millions of USD, but in addition to the cost, there is also a matter of a huge amount of equipment. For operators, touching on this topic is a huge threat to the foundations of their operations and the economy of making further decisions.
From a technical perspective, choosing one 5G supplier, not a Chinese one, is easy only when today such equipment is no longer used on a large scale.
As can be seen in the table above, only PKP and, to a relatively small extent, Polkomtel (a small amount of equipment remained after the acquisition of the Aero2 network) have an easier decision in the event of restrictions for Chinese Suppliers5G.
The table also shows that no operator has only one RAN provider. I will elaborate on this point later, writing about O-RAN/TIP.
What will the changes in 5G standards change when it comes to choosing a Suppliers5G?
The method of connecting 5G base stations to the existing 4G network is flexibly designed under the ETSI standards (3GPP TR 38.801). The 5G base station can be connected directly to the CORE SA network, the so-called NGC – New Generation Core (standard option 2), but there are also options to connect the 5G base station to the CORE SA and NSA network via a 4G base station (standard option 3 for SA and Standard Option 7 for NSA). You can also do it the other way around, i.e. connect the 4G base station via a 5G base station (option 4 of the standard). Rich flexibility, so where are the barriers? Why are current 5G Vendors of RAN equipment not allowing this?
The energy consumption of radio devices may turn out to be a significant problem in the future of cellular networks. Electricity prices are rising, and 5G technology requires a lot more energy if you want to use active antennas ( Massive MIMO). The first installations indicate a several-fold increase in energy by one base station, moreover, simply adding the 5G antenna and transmitters increases the power consumption at the location. Energy costs are already a very significant element of the operators’ Business Case. One of the solutions may be to replace the older 2G, 3G or 4G stations with one common 2G/3G/4G/5G from one 5G Provider, as long as he has actually mastered the issue of energy consumption management, as the Chinese 5G RAN Providers have done perfectly.
Therefore, operators have a dilemma whether to replace everything with one supplier (new functionalities, simpler solution, cheaper use) or to provide a solution from other Suppliers5G, leaving the older network elements as before.
What are the alternatives for the operator, can he really only choose from Ericsson, Huawei, Nokia, Samsung, or ZTE, and how can you lead a 5G implementation project?
New alternative solutions have emerged thanks to the creation of the O-RAN Alliance and TIP (Telecom Infra Project, initiated by Facebook). This is a new freshness in the field of 2G/3G and 4G/5G RAN solution providers. There are completely new players, such as Parallel Wireless and Mavenir – already implementing trial installations and deliveries for the Vodafone operator’s network. Rakuten Mobile from Japan, in turn, chose several smaller Suppliers5G, such as Airspan, Flex/KMW, and NEC as sub-suppliers of RAN elements, and Altiostar as a supplier of virtual BBUs. The integrator is Tech Mahindra.
Such a choice is possible thanks to the change in the O-RAN philosophy, which allows the operator not to take a solution from one Suppliers5G because of open standards and the suppliers’ approach on many interfaces inside the base station (referring to the existing solutions) allow for the introduction of components from different competitors. This methodology allows you to significantly reduce costs and improve the efficiency of the 4G/5G RAN network, increasing its capacity and quality. New players in software and algorithms, such as the Polish company IS-Wireless, which intends to provide SD-RAN software and RAN controller for RAN base stations, can prove themselves in this field.
Is the replacement of the existing equipment with a newer one or another supplier, the so-called SWAP, or is it the only way to modernize the infrastructure?
Changes in technology in the past, be it 3G or 4G, have always entailed the temptation of operators to verify whether it is already so that it is not time to replace the “old” with “new”. The “old” is a fairly common description because some operators prefer to amortize investments in the 10-25 year range, while others are ready to do what every 5-10 years.
As I wrote earlier, in the case of switching to the 5G generation, thanks to new functionalities, there is a temptation to unify the base station based on a single provider. This is not the first time, it was similar to tenders for 4G. All Suppliers5G has offered a new generation of equipment based on SDR (Software Defined Radio) equipment. This solution enables the launch of new versions of 4G, 5G, or 6G technologies only by changing the software and hanging antennas and radio devices on the roofs for new bands, for example, 3.XGHz.
Operators who purchased SDR solutions from Chinese vendors already had a vision of a straight path of technological development and a relatively controlled cost of TCO. Today, however, we can see that everything got complicated after the confusion with Chinese Suppliers5G. Now it looks as if the costs will have to be incurred once again if the “pressure” of market regulators is to change technology. A difficult and very expensive nut to crack, so the “wait” strategy is not an expensive strategy, one might even say a valuable one, because the situation may go differently.
Strangely enough, operators who bought equipment from European suppliers in the 1990s and at the beginning of this century also have to think about how to solve the issue of implementing 5G solutions. They have a lot of expensive to maintain, uneconomical amortized equipment on the roofs (electricity, air conditioning, taking up a lot of space). Non-modern. In this case, SWAP for a modern SDR solution “all-calling” 2G/3G/4G/5G is a very tempting piece for the 5G Provider and the operator. There is only one “but”. Is it worth moving 2G and 3G equipment? The future of mobile telecommunications is definitely 4G and 5G technologies. Wherever you look, there are millions of zlotys to spend.
What do politicians say about this situation?
The Polish government of keys. On the one hand, Poland has signed a treaty with the US on work on a secure 5G network. At the same time, the Polish government made efforts to allow Poles to enter the USA without visas, which was possible, according to politicians only in the case of cooperation on the issue of Chinese Suppliers5G and waiving the tax “digital dividend”. On the other hand, Poland is very concerned that the “silk route” should end and begin in Poland, not in the Czech Republic. This is the reality of foreign policy, nothing is simple and obvious.
A related topic, but even necessary for the emergence of 5G networks in Poland, is a tender/auction for 5G frequencies, which is still not started, and it is not known when it will end. Additionally, the Polish5G initiative was created with the participation of the Ministry of Digitization. Its task, together with the operators, is to investigate whether it makes sense to build one common 5G network in the 700MHz band under the auspices of a state-owned company as the manager.
This would mean that the 700MHz band will not be auctioned just like it did with the 450MHz band. Under the 5G tender, only the 3.xGHz bands would be left for operators in a reduced range, and then 28GHz. Consultations and deliberations continue, and time passes. Time passes, so when it comes to choosing or recommending 5G providers, the Polish Government, but also operators have some breath. They can calmly verify the decisions of other countries and scrupulously arrange international policy.
Operators do not have to buy 5G technology at the highest price, because this is how new products cost, they can wait for prices to drop and stabilize and look at OPEN RAN standards, including PoC (Proof Of Concept – online tests).
What are other countries doing in regard of Supplier5G?
Europe is considering banning Chinese Suppliers5G, while some countries, such as Germany, give operators full freedom to decide on an open market basis. Other countries, such as the above-mentioned USA and Australia, have banned the use of equipment from China, and the USA has introduced two laws prohibiting cooperation and the supply of technology from China without the consent of the US Government. The first exception was made for Microsoft.
The world is moving towards the separation of the Internet: China, Russia, Iran, etc. Will it soon matter who the provider is, since the Internet will be separated islands? An interesting discussion for a separate post.
One thing is certain, the recommendations for the Chinese Suppliers5G have not yet been given, which gives Polish operators some comfort. They can observe foreign markets, carefully look at the recommendations of the Government and Politicians, and test new, promising and cheaper solutions based on the OPEN RAN standards.
In the case of operators, in my opinion, economic and technological aspects should be decisive. The operator is a private entrepreneur whose main goal is to earn money, not necessarily to do international politics.
On the other hand, the role of politicians is to take care of our security, the only question is where the limit of the regulator’s influence will be posed.
We wait, look, and comment.
Today, everything is possible, today not all cards have been dealt.