Removing Huawei gear from EU networks could cost up to $46B, industry report says

Stripping equipment from Huawei and ZTE out of European telecom networks would cost operators between €30 billion and €40 billion, according to a report published Wednesday by GSMA Intelligence — a figure roughly three times higher than the European Commission's own estimates and one that has already drawn criticism from analysts who say the numbers are inflated.South China Morning Post+2

The study, commissioned by seven major European operator groups including Deutsche Telekom, Vodafone ↘ 1.68%, and Orange ↘ 1.39%, lands as Brussels pushes to turn years of voluntary guidance into binding rules under a revised Cybersecurity Act that would require telecom companies to remove equipment from designated "high-risk vendors" within three years.Reuters+1

A Wide Gap With Brussels

The European Commission's impact assessment had put the cost to mobile operators at €3.4 billion to €4.3 billion per year over a three-year transition, totaling roughly €10 billion to €13 billion. But that analysis covered only mobile networks. The GSMA Intelligence report, drawing on internal data from operators that collectively serve nearly half of the EU's mobile connections, extends its scope to fixed and transport infrastructure.SC Media+1

The breakdown estimates €16 billion to €22 billion for mobile networks, €9 billion to €12 billion for transport networks, and €5 billion for fixed broadband equipment. The study also projects an additional €8.5 billion in costs between 2027 and 2030 from reduced competition among equipment vendors, with mobile equipment prices forecast to rise by 24 percent.South China Morning Post+2

Critics Say Costs Are Overstated

Not everyone accepts the GSMA's figures. Hosuk Lee-Makiyama of the European Centre for International Political Economy (ECIPE) has argued that the estimates are gross figures that fail to account for replacement costs operators would have incurred regardless of a ban. The criticism echoes a longstanding pattern: when GSMA projected in 2019 that a Huawei ban would add €55 billion to Europe's 5G costs, Danish research firm Strand Consult countered with an estimate of just $3.5 billion.finance.yahoo.com+2

The GSMA, whose members include Huawei itself, has faced questions before about whether its cost projections reflect genuine market impact or industry lobbying against restrictions.finance.yahoo.com

Broader Regulatory Push

The report arrives amid an escalating regulatory campaign. In January, the Commission unveiled a draft Cybersecurity Act covering 18 sectors, from telecom to semiconductors. In May, Brussels formally recommended that all 27 member states exclude Huawei and ZTE from connectivity infrastructure. And in March, the EU's top court adviser issued an opinion stating that member states are entitled to ban Huawei equipment on national security grounds.Seoul Economic Daily+3

Whether the GSMA's cost warnings slow the legislative process remains to be seen. The revised Cybersecurity Act still requires approval from both EU member states and the European Parliament. For operators already ordered by national governments — Germany agreed in 2024 to strip Huawei from its 5G core by the end of 2026 — the financial reckoning is already underway.Reuters+1