In May 2020, the US changed an export control rule called the ‘Foreign-Produced Direct Product Rule’ (FDPR). The amended rule made an explicit statement that no company, regardless of where it might operate, could be part of the Huawei supply chain, if US technology was used in the design tools or manufacture processes.
And the effects of this policy change were also felt in the UK, where Huawei had always been viewed as a security concern, when compared to those companies operating outside China.
“Huawei has always been considered higher risk by the UK government for the reasons set out in our high-risk vendor (HRV) advice, and as such a risk mitigation strategy has been in place since Huawei first began to supply UK operators,” explained a 2020 NCSC analysis report. “Since 2010, a set of arrangements have existed between Huawei and Her Majesty’s Government (HMG) to mitigate any perceived risks arising from the involvement of Huawei in parts of the UK’s critical national infrastructure.”
With Huawei already seen as a “higher risk”, the decision was taken in July that a blanket ban would be put in place, with all Huawei kit being removed from the UK’s core network by 2027, bringing the UK in line with US policy. But it was a decision that came with a cost.
“Although the government isn’t stripping Huawei’s equipment straight away, the phased approach will have a marked effect on the telecoms industry, potentially costing billions because a lot of the major UK operators such as BT and Vodafone are already using its equipment,” explained Michael Downs, Director of Telecom Security at Positive Technologies.
The UK government, well aware of the negative effects that a ban on “high-risk vendors” would have, announced its 5G Supply Chain Diversification Strategy (opens in new tab) on November 30th, 2020, with the aim of supporting incumbent suppliers; attracting new suppliers into the UK market; and accelerating the development and deployment of open-interface solutions.
“That decision is the right one, but it also risks leaving us overly reliant on too few suppliers,” Oliver Dowden, Secretary of State for DCMS, explained at the Strategy’s launch. “That is a dilemma faced by countries across the globe - and it is one the government is confronting head-on through the publication of this Strategy.”
To achieve this, the strategy was backed by an initial fund of £250 million, and in this post we interview Tony Sceales, Head of 5G Programme Development at DCMS, to review how the investment is being deployed, look at what Huawei's removal from the UK’s 5G network means for enterprise, and discuss why the nation is moving towards OpenRAN technology.
Q: Can you explain why this diversification strategy was required for the UK’s 5G infrastructure?
Tony Sceales: There’s been a task force that’s been led by Ian Livingston, former CEO of BT, and various industry players, who’ve been involved in helping the government think through what is needed in terms of diversification. That’s also resulted in the publication of the 5G Supply Chain Diversification Strategy (opens in new tab), which is all about defining how the UK needs to achieve a more diverse telecoms supply chain, that’s based on open principles for integration, and from a more diverse number of suppliers. It’s simply not healthy for any major industry, especially one that’s part of our critical infrastructure, to be reliant on only a couple of suppliers.
Q: How is the strategy coming along so far?
TS: A lot of work has been done since the publication of the strategy, and we already have a couple of projects that have kicked off. One is called NeutrORAN, working with NEC, and there’s another one called SONIC, which is a joint venture between Digital Catapult and Ofcom. Again, this is looking at how to deliver the benefits of OpenRAN to the UK market. And how to experiment and prove that this is an appropriate and useful technology in this space. Of course OpenRAN isn’t the only part of the story; we are interested in all aspects of how we need to deliver richer and more interoperable telecoms infrastructures.
Q: How have you sold Open RAN to MNOs that have had a major supplier removed from their supply chain?
TS: DCMS works very closely with the industry across the board, not just with the mobile operators. And we always work as collaboratively as we possibly can with the industry. I think all the main players have doubled down on their efforts to work with the government, and I think you’ll find that all the operators are embracing Open RAN as a principle now, and are working on their own innovation programmes, both with, and in addition to what the government is doing. They see these initiatives as ultimately positive for them. It doesn’t help major operators to be dependent on only a couple of major suppliers.
Q: Some MNOs have been critical of spectrum auctions. Will there be a review of spectrum allocation for 5G?
TS: It’s a complex area, and Ofcom runs the auctions under a policy framework set out by DCMS; but of course Ofcom is an independent body, and sets its own rules about how the spectrum auctions progress. So it wouldn’t be right for me to comment about how they should or shouldn’t have gone about that. But I think that the response to the auction speaks for itself. People spent money on the spectrum, so they obviously value it. Money raised goes to the Exchequer, and we’re in a period of recovery from Covid. And we need to fund lots of activity across lots of different sectors, so money going into the UK Treasury’s coffers is a good thing. And it helps us to afford to do programmes like the diversification scheme, and invest in our digital infrastructure going forward.
Q: How is the UK government selling 5G as a solution for implementing Industry 4.0?
TS: It’s obviously much more flexible to use wireless technologies. But you also have to look at things like security, resilience, and the reliability aspects of the different tech. And there is a significant advantage of using a 3GPP standard of technology, which is built to address these issues. The other thing is to look at the wider enterprise need. So if you think about the mobile private network requirement, 5G doesn’t just wrap up the factory or a specific site, but actually stretches across the enterprise, providing the ability to deploy an enterprise-wide mobile private network, that covers all of the logistics between sites, whilst also catering to mobile workers as well. It’s a much bigger deal than a Wi-Fi network that applies to one individual center.
Q: How will individual enterprises go about securing 5G spectrum for private 5G networks?
TS: Clearly things are changing quite dramatically in the spectrum world. Philip Marnick at Ofcom said that 5G was the first generation in which you didn’t have to be a mobile network operator in order to operate a mobile network. And that’s due to the innovation in shared and local spectrum licensing, which allows for the ownership of spectrum slices in particular ranges. And the 3.8-4.2 GHz band in particular is the range that’s been considered for this areas. You apply for a licence in the same way as you might for any other piece of spectrum from Ofcom; however, there isn’t an auction for it, but each case is considered on its merit. So the enterprise can apply for its own spectrum, or it can work with a mobile operator and access a slice of theirs.
We see this being a significant part of the mobile scene in the future, as more hybrid networks are set up bringing together different pieces of technology in different ways, to achieve their overall business model.
Q: What steps are being taken to ensure that diversification remains secure?
TS: The first way is that OpenRAN, being a standard, defines how different components should be brought together in a secure-by-design manner. So that’s built into the OpenRAN standard at the beginning. Then of course, it comes down to the different component vendors coming together to come up with a solution that works together in an integrated way, to meet these security standards.
We’re also building, as part of the diversification programme, something called the UK Telecoms Lab, which will be explicitly run, with - and on behalf of - the National Cyber Security Centre, to ensure that security is there. Clearly, the minute you introduce new vendors and new types of tech, there’s a natural consequence that you increase the attack surface of the network, and potentially introduce new attack vectors. But the whole point of the overall strategy is to ensure that all comes together, and that adoption is driven by trust. And that trust must be there from operators before they will even consider putting any new kind of solution in place.
Q: How have you addressed concerns about the impact of 5G equipment being installed in local communities?
TS: We’ve got work to do in helping the industry innovate in creating minimal impact on the physical environment, for small cell deployments in particular. And we have a project running now that’s looking exactly at that area. As part of the government’s ‘Shared Outcomes Fund (opens in new tab)’ we’re working with the industry to make sure that the design of radios, which are going to go into those specific settings, don’t clutter the environment, and that they are sympathetic with the environmental goals that other government departments work very hard to create.
Q: To those people concerned about the impact of removing Huawei from the supply chain, what do you have to say?
TS: The diversification strategy really does work, both to support the existing supply chain, but also in supporting innovation to grow the supply chain. And now we even see all of the cloud companies - Microsoft, Google, Amazon - investing heavily in cloud networking technology. And network function virtualisation is the trend that’s moving us all down that particular path.
In public networks you can see that there will be a requirement to retain many of those big network, SLA-type activities, where you perhaps require a larger operator. Whereas I think in the realm of the enterprise, where we’re looking at private 5G networks of varying scales, you can see solutions being packaged in such a way that the IT department can manage the mobile services within that product, in the same way that they used to manage a Wi-Fi network. There are a number of software products coming to the market now that do that, and that’s a trend that I think is really interesting.
We would like to thank Tony Sceales for taking the time to speak exclusively to 5Gradar about the UK government’s 5G strategy.