What I'm reading: "Wireless Wars" by Jonathan Pelson - How free societies can build a response to China's domination of 5G -- China Boss update 3.11.22
Update
The wireless architecture of 21st century telecommunications networks carries public services and military defense, as well as other services and technologies that improve our daily lives, like hospital administration, product supply chains, e-commerce, banking and autonomous vehicles. But intelligent connectivity of these enhancements requires advanced 5G bandwidth to run the applications that can communicate with billions of “smart” devices.
Unfortunately, because of their larger bandwidths, 5G networks are more difficult to secure, and the sheer number of devices that already connect over their networks means trust in 5G vendors is paramount.
But what if the only 5G vendor in the market sufficiently capable of meeting demand is an agent of a hostile foreign nation - one that has been accused, as a 2019 Brookings Institute report said, of exporting digital authoritarianism and using the power of digital technology to “surveil, repress, and manipulate domestic and foreign populations?”
“Wireless Wars,” a new book by Jonathan Pelson offers advice on how free societies can “build a response” to “China’s dangerous domination of 5g” via its national telecom champion Huawei. Drawing on decades of experience in the telecommunications industry, as well as his work in China for Lucent Technologies in the ‘90’s and information gleaned from interviews of over a hundred industry professionals and national security experts, Pelson tells the dramatic story of how China, together with Huawei, learned from Western telecom giants, upgraded capabilities over time and, eventually, surpassed American and European firms to dominate the global telecommunications market.
Doowan Lee and I wrote about the risks of doing business with Huawei in Foreign Policy last year, but Pelson dives deeper and excavates the threat layer by layer. The egregiousness of the company’s IP theft, coordination with the Chinese government, and attempts to cover up its malfeasance are worse than we even imagined.
But it’s not all bad. Pelson shows a healthy respect for Huawei’s entrepreneurship, talent and research and development. Another topic not often explored by business and national security analysts is the Middle Kingdom’s dysfunctional cultural context - inherent in a cramped, developing nation too aware of the scarcity in its resources, but also passed down from Chairman Mao. Political necessity in the party-state is a heavy burden for Chinese companies: Huawei does not exist in a vacuum.
Pelson cites eye-witness accounts from industry insiders that suggest Huawei’s local competitive environment is one of “zero trust” where “every desk and workstation” in the firm’s Shenzhen headquarters has “a large gun safe” for employees to put office notes, project materials, and “whatever they had been working on … behind a quarter inch of hardened steel.” This is because ZTE, a Chinese state-owned telecom firm, whose command post is also located in Shenzhen, “wouldn’t think twice about taking intellectual property from a fellow Chinese company.” Worse, Huawei corporate leaders appear to mimic Beijing’s national policy management by pitting those in its service against one another in a ruthless competition to achieve certain, and, often, over-ambitious aims. So, the same is true, Pelson writes, not only of the engineer across the street, but of the “guy down the hall.”
“Wireless Wars” is a delight to read, and Pelson’s a great story-teller. He mentions only the telecom techy stuff the reader really needs to know to understand the high stakes geopolitical race to control 5G in global communications, uses simple language to explain difficult technical and political issues, and stocks the book with astonishing true stories and good-humored anecdotes. “Wireless Wars” is a must-read for cyber-security and telecom professionals, as well as national security experts and, of course, China watchers.
Wireless Wars: China's Dangerous Domination of 5G and How We're Fighting Back by Jonathan Pelson (on Amazon).
Read “Wireless Wars” to find out how a 5G solution that is, both, affordable and supports free societies is possible and why getting back to “permissionless innovation” might be the answer.
Selected quotes from Jonathan Pelson’s Wireless Wars:
“Working in Beijing in the late nineties, I found myself unable to bribe my customers.” p. 1
“Western telecom executives found themselves in a trap, faced with the choice between moving their manufacturing to low-cost locations (with the risk of an eventual loss of control) or keeping it local and ensuring their imminent defeat by any companies that did take advantage of cheap labor and R&D.” p. 5
“…China would not install a single switch if they couldn’t listen to what was being said over it.” p. 55
“Needless to say, the small start-ups liked the [vendor financing] approach too, but soon getting the gear for free wasn’t enough.” p. 80
“The hundred-year-old firm, which had barely survived the 2001 telecom meltdown and was already facing a death spiral, collapsed in the face of this low Huawei bid, losing 40 percent of its stock value that day.” p. 100
“They take care of the ones they feel they’re responsible for - company, family, country. If they’re working for Huawei, and Huawei is helping them succeed, of course they would steal ZTE’s stuff, of course they would steal Cisco’s stuff. It would be wrong not to seize an opportunity to support the party you’re responsible for.” (citing Tom Miller) p. 129
“When Lenkart and his team overlaid a blueprint of these locations on top of the companies and towers that use Huawei gear, they were stunned at what they found: Huawei’s deployments in rural America mapped inexplicably close to the areas of sensitive military and government operations.” p. 157
“The images of crowds of people carrying umbrellas on rainless days show one of the simple countermeasures taken to prevent facial recognition applications from succeeding.” p. 198
“For the first time many of them saw that China was not playing by the same rules.” p.204
“Scale may not be the only way to win this game.” p. 233
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Have a great weekend.