Europe Faces a €40 Billion Bill to Strip Out Chinese Network Gear

A proposed EU rule forcing telcos to replace Huawei and ZTE equipment could cost up to €40 billion and slow buildout, industry researchers estimate.

The European Commission's proposed Cybersecurity Act 2 framework would require member states to remove and replace critical telecom equipment from designated high-risk vendors — a category that refers to China-based suppliers such as Huawei and ZTE. Mobile operators would get three years to pull the targeted gear, with different deadlines for other networks.

GSMA Intelligence, the research arm of the mobile industry's trade body, puts the replacement cost at €30 to €40 billion (about $45.5 billion at the top end), based on a survey of seven EU operator groups. At a €35 billion midpoint, mobile networks account for €19 billion, fixed infrastructure €5 billion, and transport elements €11 billion. The report also projects equipment prices rising as much as 24 percent for mobile kit once cheaper suppliers are excluded, adding roughly €8.5 billion in costs between 2027 and 2030.

For connection as a shared need, this is friction: money spent tearing out working equipment is money not spent extending coverage or lowering prices. Huawei reportedly supplied nearly 60 percent of Germany's installed 5G gear a few years back, so the disruption is real. The UK already went through a forced Huawei removal after US pressure.

Watch whether CSA2 becomes binding and how deadlines are set. The caveats are heavy: the cost range rests on just seven operators surveyed by the industry's own lobby, a cited €370 billion economic-loss figure came from a study done with the China Chamber of Commerce, and the price projections are modeled, not observed.

Source: The Register