Huawei, which has trumpeted its role in 5G, poured cold water on the technology, saying most consumers would not notice its benefits and operators would struggle to make money from it.
The reversal came as 5G has moved to the political agenda, with components ensnared in the US-China trade war and fears of Huawei’s supremacy in the technology prompting Donald Trump to block Broadcom’s acquisition of Qualcomm.
Speaking at the group’s analyst event in Shenzhen yesterday, rotating chairman Eric Xu said that while 5G was faster and more reliable, consumers would find no “material difference between the two technologies”.
The technology has been seen as a necessity for the age of autonomous driving and connected devices making up the internet of things. But Mr Xu said that “even today we have the technology that can support autonomous driving”.
Analysts said Huawei’s reversal echoed gloom among telecoms operators and kit manufacturers.
“Pessimism about 5G has been growing behind the scenes in the mobile industry, but Huawei is the first large infrastructure company to state it explicitly,” Ben Stanton, analyst at Canalys, said. “The reality is that 5G will be incredibly expensive for operators to deploy, requiring tens of thousands of new base stations per country and the industry is yet to uncover a killer-use case for the 5G network.” Mr Xu said Huawei would continue to invest in the technology, saying failure to do so would cost it. “If you are not good at 5G, customers won’t buy from you, even for 4G.” The same applied to telecoms operators. “If one says, ‘I have 5G-enabled network’, the rest really have to launch 5G, even if it’s just for branding or marketing purposes.”
Ericsson has projected that there will be 1bn 5G connections by 2023. It has been positive on prospects but has started to focus more on industrial benefits of early adoption.
Nokia said little more than that it believes it is better positioned than rivals in the technology.
