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Huawei ban will act as ‘5G tax’ on Australians

Huawei ban will act as ‘5G tax’ on Australians

​Regional Australia will also miss out on the benefits of the technology, the Chinese networking giant says.

Credit: Huawei

Excluding Huawei from Australia’s 5G roll-out will act as a ‘5G tax’ on citizens and increase the cost of deploying the technology by between $700 million and $2.1 billion, the networking giant said on Wednesday.

In its submission to a federal parliamentary enquiry, published yesterday, Huawei - which has been banned from participating in the 5G project - claimed that local operators will pay between 20 and 40 per cent more than the rest of the world for 5G technology.

One of the biggest impacts of its exclusion will be the inability for regional Australians to get access to 5G services, Huawei said in its submission.

“Because of the 20 to 40 per cent increase in technology costs, the business case for telecom operators to roll-out 5G in regional Australia becomes near impossible,” the submission said.

“At a time where 5G smart farms are operating now in the UK, South Korea and Switzerland, Australian farmers will be waiting years to get an opportunity to benefit from the productivity gains from 5G. Many may never get the opportunity, especially farmers on the fringe of the current 4G network, Huawei said.

The financial business case for operators to build coverage in regional Australia will be difficult to stack up.

“A 30 per cent increase in equipment costs will destroy what business they currently have. We will see the Australian footprint plans to reduce considerably at the cost of regional Australia,” the submission said.

Only three global vendors - Huawei, Nokia and Ericsson - are capable of supply large-scale advanced 5G mobile network equipment, the company claimed.

“Already, Australia has reduced this to a duopoly situation. It is Huawei’s belief that, in reality, Australia’s 5G technology vendor market will be a near monopoly, with one company dominating, if not becoming the sole supplier of 5G in Australia.

“This will have a profound impact on the cost, innovation and security of Australia’s 5G future,” the company claimed.

Meanwhile,  Huawei said it welcomed a “rigorous and transparent examination of this ban” with the learning experience in the UK and the European Union of robust checks and balances as a way forward to revisiting the ban.

“Both Huawei in Australia and its parent company are determined and committed to a forensic and transparent decision-making process that is based on facts, not innuendo.

“Huawei delivered the first 3G network in Australia, the first 4G network and has constructed the largest private 4G network in the Southern Hemisphere in the Cooper Basin. Huawei Australia’s locally incorporated board and more than 600 dedicated and trusted staff are proud of the contribution they have made and continue to make in the Australian telecommunications sector,” the submission said.

Huawei also claimed in its submission that the Australian 5G deployment “has been so constrained it is more a marketing tool than the substantial transformative technology for the Australian economy.

“There are more marketing billboards than there are 5G base stations in Australia. While deploying 5G at the MCG for the AFL Grand Final might make for a whimsical media release, it doesn’t make up for the fact that our 5G coverage remain miniscule compared to our international peers.”

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Follow Byron Connolly on Twitter: @ByronConnolly



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