Europe faces billions in additional cost if telecoms are banned from buying Chinese hardware, a leaked industry analysis claims. In addition to increasing costs by approximately $62 billion, the analysis allegedly states, the delay would also put Europe around 18 months behind on its 5G network plans. Nokia has challenged parts of the leaked analysis as it prepares to fill the space Huawei occupied.
The US took a major step against Chinese company Huawei, the world’s biggest telecom hardware company, by putting it on a trade blacklist last month. The decision spurred a number of major changes for the company, which saw multiple big tech companies sever ties with the company.
Europe is left in a tough position, facing pressure from the US to implement similar measures. At the heart of the matter are concerns about Huawei’s role in the world’s budding 5G infrastructure, particularly allegations that the equipment may enable the Chinese government to spy on communications. Huawei has repeatedly denied the allegations.
In a report published Friday, Reuters claimed it has viewed an industry analysis on the matter by GSM Association, which has already been vocal about concerns over a complete ban on Huawei. The analysis reportedly found that half of the additional $62 billion cost would be the result of ‘high input costs following significant loss of competition in the mobile equipment market.’
For its part, Nokia challenged an aspect of the leaked analysis that claims European operators would be forced to replace the existing infrastructure before it could start ‘implementing 5G upgrades.’ In a statement to Reuters, Nokia said that isn’t true, and that it already has a ‘technical solution’ that would enable it to ‘overlay our 5G equipment on top of another vendor’s 4G gear.’
Nokia, which reports having outpaced Huawei in overall 5G orders, claims its solution may ‘reduce the cost and complexity of vendor changes.’ The company has seen interest in its own services grow amid the security concerns surrounding Huawei. Nokia revealed earlier this month that it has signed 42 commercial 5G deals, including 25 in Europe.