Thursday, 10 December 2020 09:01

Huawei says telco law changes have hit the company very hard Featured

Huawei says telco law changes have hit the company very hard Image by F. Muhammad from Pixabay

The Telecommunications Sector Security Reforms, put in place just after the Turnbull Government was toppled in 2018, have hit Huawei Australia hard, with the company losing 900 direct jobs, more than 1500 sub-contracting jobs and $100 million in R&D in Australia, the company claims in a submission to a parliamentary inquiry.

The inquiry, being conducted by the Joint Parliamentary Committee on Intelligence and Security, is a review of part 14 of the Telecommunications Act of 1997, the TSSR.

Huawei's is one of eight submissions thus far, but the lone one from a company that has been badly affected. iTWire will report on the submissions by other companies, organisations and government departments in coming days.

The TSSR was used to ban Huawei from bidding for contracts in Australia's 5G networks in August 2018, just as Malcolm Turnbull's feet were being cut from under him by his own party. The submission pointed out that till today, there had been no official reason given for the ban.

"Huawei chairman John Lord was called by then Secretary of the Department for Communications and the Arts, Michael Mrdak, five minutes before the press release was issued to ban the company without any reason other than Huawei was a Chinese-headquartered company," it said in its submission." The public press release, which doesn’t mention Huawei or China, remains the only written notification of the ban Huawei has had."

Huawei said it had supported development of the TSSR "as it promised to provide clear security guidance for telecommunications operators and vendors".

"It promised to provide a transparent and open security framework to guide operators and vendors to develop products and networks that would meet Australian Government requirements and standards."

But, the company argued, though the reforms were advertised as needed to ensure security and resilience of the telecommunications infrastructure and also the country's social and economic well-being, this did not eventuate.

"In practice, the TSSR legislation destroyed Australia’s global mobile network leadership, reduced vendor competition, forced up prices for operators and consumers, isolated Australia from the world’s leading 5G innovation (as well as the ongoing leading innovation in 6G, 7G etc) and failed to make the nation any safer," the submission said.

"The TSSR reforms could be viewed as a tool designed to remove Huawei and other Chinese-headquartered companies from the market. TSSR hasn’t made the Australian telecommunications network any safer or more secure.

"In fact, we argue because of the over-dependence on one single vendor in Australia, the security risk of a ’single point of failure‘ has made Australia’s telecom networks far more vulnerable." The reference to a vendor is Sweden's Ericsson which has gobbled up a major share of contracts from the three telecommunications companies building 5G networks; Telstra, Singtel Optus and TPG Telecom (the merged TPG and Vodafone).

Huawei pointed out that even though its origins in China had been a negative factor in Australia, both Ericsson and FInland's Nokia were also making their equipment in China and had close partnerships with Chinese Government entities.

"If the ‘risk’ is China, then how is it that Ericsson and Nokia can still manufacture, compile software and work in partnership with the Chinese Government for building 5G technology and then deliver those products into the Australian 5G networks with no independent testing?" the Shenzhen-headquartered firm questioned.

It also pointed to the fact that the myth about lack of separation of the radio access network and the core in 5G networks had been bandied about by Australian authorities — including the then head of the Australian Signals Directorate, Mike Burgess — even though that was incorrect. The other reason cited by Australia for the ban was possible influence by a foreign government on certain vendors.

"The global 5G standards agencies 3GPP and GSMA, the vendors that make the technology and the global operators that run the 5G networks clearly state that core and non-core parts of the network are similar to current 4G networks," the submission pointed out.

"In fact, a UK Parliamentary Committee concluded that the Australian position was contrary to all the evidence they gathered. In truth, 5G network architecture is very similar to the 3G and 4G networks that Huawei has deployed in Australia over the past 15 years."

And it cited a statement from the UK Parliamentary Committee on Science and Technology that said: “Although the Australian Government has concluded that the distinction between core and non-core networks will be less clear than for previous technology generations, we heard unanimously and clearly that a distinction between the core and non-core parts will still exist.”

A second statement from the same panel was cited by Huawei to illustrate that it was not the only entity pushing the notion that fewer vendors would make for worse security. "...the telecommunications market has been consolidated down to just a few players: in the case of 5G there are only three potential suppliers to the UK – Nokia, Ericsson and Huawei. Limiting the field to just two... would increase over-dependence and reduce competition, resulting in less resilience and lower security standards.

"Therefore including a third company — even if you may have some security concerns about them and will have to set a higher a bar for security measures within the system — will, counter-intuitively, result in higher overall security.”

The UK initially gave Huawei the green light to supply up to 35% of equipment for non-core parts of its 5G networks. But American pressure resulted in London first saying that it would remove all Huawei gear by the end of 2027 and, more recently, bringing that deadline forward to the end of September 2021.

The US has campaigned for more than two years to try and push countries it considers allies to avoid using 5G equipment from Huawei in their networks. Thus far, only Australia and Vietnam have said openly that they would follow the US' lead.

Sweden recently became the third country to say so publicly, but a court later suspended sections of a decision that had excluded Huawei from participating in Swedish spectrum bids. The spectrum auction itself was put on hold.

New Zealand and Poland have indicated that they are likely to toe the US line, but have yet to make public pronouncements about what policy they would follow.

Germany, Japan and South Korea have now indicated that they would not issue a blanket ban on Huawei as demanded by Washington.

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Sam Varghese

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Sam Varghese has been writing for iTWire since 2006, a year after the site came into existence. For nearly a decade thereafter, he wrote mostly about free and open source software, based on his own use of this genre of software. Since May 2016, he has been writing across many areas of technology. He has been a journalist for nearly 40 years in India (Indian Express and Deccan Herald), the UAE (Khaleej Times) and Australia (Daily Commercial News (now defunct) and The Age). His personal blog is titled Irregular Expression.

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