Circular economy offers operators lifeline in Huawei, EU tech battle

Circular economy offers operators lifeline in Huawei, EU tech battle


The circular economy offers operators a lifeline as they look to both remove and replace Huawei and ZTE equipment from their networks.

The concept of the circular economy is a model of production and consumption that essentially involves sharing, leasing, reusing, repairing, refurbishing and recycling existing materials and products for as long as possible.

According to Kieran Crawford, group director at TXO says the circular economy allows operators to both recycle or resell equipment, ensuring they can meet their sustainability goals and claw back revenue from their extracted equipment.

“Operators can also purchase new equipment from the secondary market to replace the Huawei equipment in their networks, which can often be 50% to 90% cheaper than buying directly from OEMs,” he told Capacity.

As pressure continues to mount on Huawei, European operators looking to replace the tech will face significant costs.

Huawei recently hit back after the European Commission increased pressure on member-nations to stop the use of equipment from Chinese vendors in their networks.

Crawford believes this is a “huge” task, noting that Timotheus Höttges, CEO of Deutsche Telekom has hit back at the necessity to remove all Huawei radios from its network, with the operator estimated to be using around 47,200 from the Chinese vendor.

“Replacing this ‘vulnerable’ technology will inevitably be costly,” he says.

According to recent TXO research, 54% of operators have experienced an 11% to 30% cost increase on all new network hardware from OEMs recently as a result of recent supply challenges.

Changing the technology with new equipment could become cost-prohibitive, Crawford believes.

“The extraction of Huawei equipment will force operators to embrace the circular economy and make it a part of their ongoing procurement and sustainability practices by not just feeding it, but also consuming from it.”

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