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How 5G got tied up in the US trade war with China

por Anh Mordaunt (2019-08-17)

id="article-body" class="row" section="article-body"> US President Donald Trump shakes hands with Chinese President Xi Jinping before a bilateral meeting during the G20 Summit last month. 

Getty Images What do 5G and the Chinese telecom-gear maker Huawei have to do with the escalating trade war between the US and China? In a word: everything. 5G, the next generation of wireless, will not only allow you to download an entire season of Stranger Things in minutes, but also serve as the foundation to support the next generation of infrastructure, including billions of internet-connected devices powering smart cities, cool new VR and AR applications and driverless cars.

Naturally, President Donald Trump wants the US to lead in 5G. 

What's at stake is more than just bragging rights; the outcome of the 5G race is likely to determine whether the US will continue to maintain its technological edge and shape geopolitics for the next couple of decades or if it'll cede that control to China, which sees technological dominance as a way to become a world superpower. 

In the middle of it all is Huawei. A year ago, most Americans had likely never heard of the company. Now it's in the news nearly every day as a centerpiece of the US-China trade battle. Huawei is a dominant supplier in the 5G market. But national security experts say the company's close ties to the Chinese government could be dangerous for the US and its allies, because its gear could be used for espionage or to shut down critical communications networks during some future conflict. 

Huawei is also emblematic of a bigger issue the US is grappling with. As China tries to transition from a country known for making toys and cheap plastic tchotchkes to one that leads in advanced technologies like artificial intelligence, autonomous vehicles, robotics and 5G, it's adhering to a state-led industrial policy that US intelligence officials say relies on intellectual property theft, forced technology transfers, cyberespionage and discriminatory treatment of foreign investment, according to the Council on Foreign Relations.

It's these concerns over unfair trade practices that have led to Trump's tariffs on the import of Chinese goods and the blocking of Huawei and other Chinese tech companies from access to US markets.

Now playing: Watch this: Is 5G coming to a city near you? 2:50 China has rebutted these allegations in a 67-page document entitled, "The Facts and China's Position on China-US Trade Friction," which it published in September last year.  The Chinese embassy forwarded CNET the document when asked for comment about how the US has categorized its efforts to transform its economy. In that document, China calls the US' accusations that it's stealing advanced technologies an "insult to China's efforts to push for scientific and technological advances." 

"The Chinese nation is known for diligence, intelligence, and ingenuity," the document says. "The progress in science and technology China has made comes from years of implementing a strategy of invigorating the country through science, technology and education and the strategy of innovation-driven development, and from the hard work of the Chinese people, especially scientific workers."

To help you better understand why the US is so hell-bent on keeping Huawei out of 5G networks and what it means for the future of the wireless world, we've put together this FAQ. 

What's 5G again?
It's the next (fifth) generation of cellular technology, which promises download speeds 10 to 100 times faster than those of current 4G networks. It's being rolled out across the country now. 

One of the key benefits is something called low latency, which is the response time between when you click on a link or start streaming a video on your phone, which sends the request up to the network, and when the network responds, delivering you the website or playing your video.

That responsiveness is critical for things like driving autonomous vehicles that need to make split-second decisions to avoid crashes or using an augmented reality application in the grocery store to pick out a safe product for your child with a severe food allergy. 

Why is it important for the US to 'win' the race to 5G?
The short answer is that whichever country leads in the development and deployment of 5G technology will see more economic growth and will have more power.

"The leader of 5G stands to gain hundreds of billions of dollars in revenue over the next decade, with widespread job creation across the wireless technology sector," the Defense Innovation Board, a group of American business leaders and academics, said in a report for the US Department of Defense earlier this spring. Tech heavyweights such as former Alphabet Chairman Eric Schmidt, LinkedIn founder Reid Hoffman and Walter Isaacson, the author and a former chief executive of the Aspen Institute, participate on the board.

Huawei is one of the leading companies developing 5G equipment. 

Getty Images For the US, this means maintaining the technological and economic lead it developed with its 4G wireless technology. But for China, it's an opportunity to surpass the US and the West to become the economic and geopolitical superpower it has long wanted to be.

That said, not everyone agrees that it's a race. In a blog post last week, former FCC Chairman Tom Wheeler said:

"'Winning 5G' is not so much a 'race' as it is a process. Characterizing 5G as a contest demeans its great technological progress and the policy challenges that progress presents. 5G should be more than a political talking point; the new network represents the need for a meaningful policy strategy."

How's the US doing? 
It depends whom you ask and on what day. Trump is all over the map. One day, he says the US is lagging in the 5G race and needs to catch up to China. The next day, he's saying the US is winning and will dominate 6G. 

Even wireless and technology experts can't seem to agree. Wireless industry trade association the CTIA claims the US is "tied" with China. And it's advocating for policy objectives to keep pushing the US toward dominance. 

But the Defense Innovation Board offered a more dismal outlook. In its report issued in April it offered a scathing assessment:

"The country that owns 5G will own many of these innovations and set the standards for the rest of the world," it said. "That country is currently not likely to be the United States."


Why is the Defense Innovation Board's assessment so bad?
There are several reasons. For one, the authoritarian regime in China has invested massive amounts of money in companies such as Huawei to develop 5G technology, to great success. Chinese companies hold the majority of the world's 5G patents. The Chinese government also controls China's wireless service market and is pushing its three major providers, China Mobile, China Unicom and China Telecom, to combine efforts to develop a standalone 5G network that'll commercially launch in 2020. 

US officials say the US must win the race for 5G.

Getty Images Meanwhile, there are no major US companies building and developing 5G telecom equipment. Thanks to decades of market consolidation, US companies once dominant in providing telecom gear have been sold to foreign companies. And now the market for 5G gear is led by Chinese-based Huawei as well as Nokia and Ericsson, both based in Northern Europe.

The US' free market approach also makes getting a nationwide 5G network built quickly a challenge, 유로247가입주소 as the four major US wireless companies struggle to balance intense competition with network investment and innovation for 5G. 

But the biggest issue for the US, according to the report, is that the country hasn't been quick enough in making available the wireless spectrum that's essential to deploying the service. And the spectrum the US is making available is the wrong kind. 

Specifically, the US has been allocating a lot of so-called millimeter wave or mmWave  spectrum, which can transmit huge amounts of data very fast. But signals can travel only over short distances, and interference like trees or even bad weather can disrupt service. The problem with using this spectrum is that it's hugely expensive to build a network this way. And it'll be impossible to blanket the nation with the service, because it'll be too costly.

Ideally, the US needs midband and low-band spectrum in the mix. The only problem is that the prime spectrum that could be used for this service is already being used by the military. And getting government agencies to share spectrum with commercial entities is no easy task. The report says the US needs to work more quickly to force military and government stakeholders to share this spectrum with the wireless industry. 

How does Huawei fit into all this? 
Huawei is one of the biggest makers of 5G equipment, and its technology is also considered to be the most advanced. And it's the second largest smartphone maker behind Samsung, having surpassed Apple last year. 

But it's not your average tech giant, according to US national security experts. The company, founded in 1987 by a former officer of the Chinese People's Liberation Army, still has close ties to the Chinese government, according to six US intelligence chiefs, including the directors of the CIA, the FBI and the National Security Agency, who testified before Congress in 2018 that the company could conduct "undetected espionage" if its gear was used in US networks. Huawei has repeatedly denied these claims. 

For years, national security experts in the US have been concerned about Huawei, fearing that Beijing could direct the company to put backdoors in its software to spy on the US and its allies. They also fear that Huawei's gear could be used in a massive cyberattack that could disrupt communications networks in the event of a conflict between the US and China.  

The company has also been accused by the US Justice Department, in indictments that included 23 counts of alleged theft of intellectual property, obstruction of justice and fraud related to allegations it bypassed US sanctions against Iran. Huawei CFO Meng Wanzhou was arrested in Canada at the request of the US, and awaits extradition.