The EconomistSeptember 14th 2019 631I
n an atriumdesigned to evoke ancient
Greece—ringed by stone columns and six
towering approximations of the Caryat-
ids—it was fitting that Ren Zhengfei, chief
executive of Huawei, should extend an ol-
ive branch to the West: a piece of his com-
pany. The palatial edifice on Huawei’s
sprawling campus in Shenzhen houses an
exhibition hall proudly displaying the Chi-
nese telecommunications giant’s “fifth-
generation” (5g) technology. The ultra-
swift, and ultra-coveted, mobile-phone
networks will soon connect everything
from cars to industrial robots.
It is this 5g technology—central to Hua-
wei’s future revenue growth—that Mr Ren
said he was ready to share, in a two-hour
interview with The Economiston Septem-
ber 10th. For a one-time fee, a transaction
would give the buyer perpetual access to
Huawei’s existing 5g patents, licences,
code, technical blueprints and production
know-how. The acquirer could modify the
source code, meaning that neither Huawei
nor the Chinese government would have
even hypothetical control of any telecoms
infrastructure built using equipment pro-duced by the new company. Huawei would
likewise be free to develop its technology
in whatever direction it pleases.
Huawei has been on a charm offensive
this year. It has wheeled Mr Ren out once a
month since January for interview bonan-
zas with international media outlets. But
the idea of transferring its 5g“stack” to a
competitor is by far the boldest offering to
have surfaced. “It’s hard to come up with
similar precedents in the history of tech-
nology,” says Dan Wang of Gavekal Drago-
nomics, a research firm.
Mr Ren’s stated aim is to create a rival
that could compete in 5g with Huawei(which would keep its existing contracts
and continue to sell its own 5gkit). To his
mind, this would help level the playing
field at a time when many in the West have
grown alarmed at the prospect of a Chinese
company supplying the gear for most of the
world’s new mobile-phone networks. “A
balanced distribution of interests is con-
ducive to Huawei’s survival,” Mr Ren says.
No kidding. A months-long assault by
America has pummelled the firm, whose
global networks it suspects of allowing
China to spy on others. America has also at-
tempted to press allies not to use Huawei’s
equipment as they begin to build their own
5 gnetworks. In May American companies
were barred from selling components and
software to Huawei on the ground that it
posed a national-security risk. Last month
America restricted government agencies
from doing business with it (the firm is
challenging this ban in court).
At first glance, Mr Ren’s gesture has
much going for it. If the sale eventually
gave rise to a thriving competitor, coun-
tries such as Australia (which has banned
Huawei’s gear) would no longer have to
choose between, on the one hand, technol-
ogy in their networks that is both cutting-
edge and cheap, as Huawei’s is, and, on the
other, fears of Chinese eavesdropping.
They could have the best technology from
an ally instead. Decisions on the purchase
of telecoms equipment could then return
from politicians to pragmatic boardrooms.
The gesture may also convince those
suspicious of Huawei’s tech that the firm’sHuaweiPiece offering
SHENZHEN
Ren Zhengfei appears prepared to sell all Huawei’s 5gtechnology
to a Western buyerBusiness
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