With a ban that will effectively prevent Huawei from doing business with U.S. companies set to go into effect in November, it seems Huawei has come up with an idea that could potentially allow it to maintain a foothold in western markets: a one-time licensing deal that would give a buyer unlimited access to Huawei’s current 5G patents and tech.
In a recent interview with the Economist, Huawei CEO Ren Zhengfei said the deal would allow whoever licenses it patents to examine and modify Huawei’s source code, ostensibly as a way of eliminating any fears that Huawei or China could spy on cell networks that used any of Huawei’s 5G gear.
As the world’s largest maker of 5G networking equipment, Huawei clearly has a vested interest in maintaining its ability to sell 5G tech outside of China, as the U.S. ban would force American carriers (along with carriers in many allied nations) to rely on equipment from Nokia or Ericsson, who are two of Huawei’s biggest 5G networking competitors. In addition, the U.S. has attempted to use its waning influence over allies to convince other countries to also ban Huawei from installing networks within their borders.
However, at this point, Huawei’s patent licensing deal could be more of a last-minute brainstorm than a concrete proposal, as Ren said Huawei has not put a price on what it would cost to license Huawei’s 5G stack, and that Huawei currently has “no idea” which companies might actually be interested in the deal.
Huawei’s trial balloon for a compromise comes just weeks ahead of the White House’s plans to engage in a fresh round of high-level trade talks with China. The crown jewel in China’s tech crown has been perceived by many to be a bargaining chip in the Trump administration’s trade war, a perception that Secretary of State Mike Pompeo has made efforts to contradict.
If the deal were to go through, it would almost instantly create a new player in the race to 5G, as countries look for providers to help upgrade existing cell networks with next-gen capabilities.
But with Huawei also having to combat the idea of losing access to Android—which up until now has been the OS used on all of the company’s smartphones—anything that would allow Huawei to maintain a presence outside of Asia is probably worth exploring, at least from their point of view.