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Huawei CEO offers to license 5G stack to new competitor

Thursday 12 September 2019 | 15:32 CET | News

Huawei is prepared to sell a perpetual licence to its 5G stack to help create a competitor on the market, CEO Ren Zhengfei said in an interview with The Economist. The buyer would be able to modify the source code to build its own network equipment, a move that could help alleviate concerns about Huawei's alleged ties to the Chinese government. 

For a one-time fee, the transaction would give the buyer perpetual access to Huawei’s existing 5G patents, licences, code, technical blueprints and production know-how, the report said. Huawei would keep its existing contracts and continue to sell its own 5G kit, while the licensee could develop alternative offerings.

The idea is to create more balance in the market, with more alternatives for the sensitive 5G equipment key to future wireless networks. "A balanced distribution of interests is conducive to Huawei’s survival," Ren said. Furthermore, the proceeds from the licence could be used to further the company's own R&D. 

Ren said he had "no idea" would could be a potential take of licence. Rivals Nokia and Ericsson are unlikely to be interested having already developed their own systems. 

His proposal appears an attempt to call the bluff of the US government, which has opposed use of Huawei equipment due to concerns about Chinese government spying, without presenting any significant evidence for this. The American protests may be due more to concerns about Huawei's growing dominance of a market with very few - and no American - players. Even if an American firm did acquire the licence, it would face the challenges of an industry reliance on Chinese manufacturing and competing with Huawei's sharp prices. 



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Categories: Mobile & Wireless
Companies: Ericsson / Huawei / Nokia
Countries: World
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