BT aims to roll out full-fibre broadband to 4m homes by 2021 © Johnnie Pakington/BT
BT aims to roll out full-fibre broadband to 4m homes by 2021 © Johnnie Pakington/BT

Limiting Huawei 'will cost BT £500m'

31 January 2020

BT estimates the UK government’s decision to restrict the use of “high-risk vendors” (HRVs) such as Huawei in the 5G network will cost it around £500m over the next five years. 

In a trading update, BT chief executive Philip Jansen told investors the bulk of the cost will come from stripping out 4G boxes developed by Huawei as it continues to roll out its 5G network.

“The main impact is on the mobile side. We’re going to have to take out some 4G boxes and replace them with providers other than Huawei,” he said.

Earlier this week, the government issued new restrictions on the use of HRVs in the 5G network. HRVs will be excluded from “sensitive core parts of 5G and gigabit-capable networks” and there will be a 35% cap on HRV access to non-sensitive parts of the network.

“There’s been a long debate about the role of Huawei in the communications network of the UK. This clarity from the government is extremely helpful to allow us to plan properly. While there are still a few questions to be resolved on what they’ve announced, we can see a path to maintaining our 5G leadership and rolling out very fast,” Jansen said. 

“The security of our network is paramount and we are very supportive of what the government is doing here. We already have a long-standing principle to not use Huawei in our core networks.

“As the guidance is developed into legislation, there will be an impact on our 5G rollout plans. We are in the process of reviewing the guidance in detail to determine the full impact on our plans. At this time, we estimate an impact of around £500m over the next five years,” Jansen added. 

Meanwhile, a spokesperson for Vodafone UK said the firm “uses a mix of Huawei, Ericsson and Nokia equipment for its 4G and 5G masts, and we continue to believe that the use of a wide range of equipment vendors is the best way to safeguard the delivery of services to all mobile customers”. 

According to the BBC, US secretary of state Mike Pompeo said US and UK officials would work together to reduce risks after the UK's decision to allow Huawei to be involved in its 5G network. 

The US had previously pressed the UK to block Huawei’s involvement, alleging the equipment posed a spying risk from China.

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