Telefónica Deutschland goes with Huawei to build 5G network

(Image credit: Telefónica.)

Telefónica in Germany has said that Huawei will help to build its 5G network, despite the ongoing political discussions around the globe about whether Chinese technology is safe to use. 

But it’s believed that Telefónica Deutschland couldn’t delay the decision any longer, having already said that it would have to cut its dividend to invest in its 5G technology, which will be rolled-out next year. (The network will include equipment supplied by both Huawei and Nokia.) 

Not wanting to fall behind 

This decision comes amongst the growing political unrest in Germany, regarding the use of Huawei’s equipment. Senior politicians called for a ban, due to concerns that Huawei could be required by Chinese law to share information with the government. 

This view was in line with the US stance that countries should ban the use of Huawei’s equipment altogether. However, the Chancellor of Germany Angela Merkel was keen to keep a level playing field, and enable all suppliers to “prove” themselves as secure. 

Deutsche Telekom is holding out

And although Telefónica Deutschland has made its decision, Deutsche Telekom, the largest telecom in Germany, said last week that it was putting spending on 5G equipment on hold, due to the continued uncertainty surrounding Huawei.

“We hope that we will get political clarity for the 5G network buildout in Germany as soon as possible in order not to fall behind,” said a spokesperson.

Vodafone, the third biggest player in the German telecoms market, has also warned that it risks falling behind in 5G deployment if the Huawei situation continues. 

And there is a significant risk of skilled jobs moving to other countries as European infrastructure falls behind, all because of the debate surrounding Huawei. A decision needs to be made very soon. 

Within the UK's 5G networks, O2, Telefonica’s UK operator, used Huawei equipment in its 5G network trials, but ended up selecting Ericsson and Nokia as its main suppliers.

Fiona Leake

Fiona discovered her love for investing and making money from a young age. Since then this interest has grown and now she loves writing about investing and business, and follows the 5G market closely. She is also a technology enthusiast, and so they tend to be her favourite investments.