US focus on blocking China’s 5G technology misses bigger manufacturing risk
- Venture capitalist Sean O’Sullivan says divided technology landscape would hand China an advantage
- Competing US and Chinese technologies will force third countries to choose between systems
China’s Great Firewall, erected over the past 15 years to restrict domestic access to the internet, may be a bigger problem than concerns over the spread of China’s 5G technology, according to a US venture capital investor.
Fears that networking equipment manufactured by China’s national champion Huawei Technologies could offer Beijing a back door to spy on computer networks may not be as big a deal as China’s Great Firewall effectively dictating how devices connected via this new technology will be manufactured, the investor said.
“By having a bifurcated internet, it has created a very effective trade barrier for hardware. Everything that is being manufactured has to be for the China market and then the rest of the world market,” Sean O’Sullivan, founder of the US$650 million venture capital firm SOSV, said on the sidelines of the 2019 China Institute Executive Summit in New York.
“The Great Firewall used to be just for software. Now it applies to all manufactured things just because the connectivity of manufactured things is being built into everything,” he said in an interview on Thursday.
In China’s case, the creation of the firewall meant they had been rebuilding the internet in their own image for quite some time, O’Sullivan said, and whatever Washington was doing to forcefully stop Huawei on 5G would be overshadowed.
