November 11, 2022. Zurich, Switzerland – As part of an effort to share cutting-edge knowledge relevant to both China and the world, CEIBS recently teamed up with the Swiss Chinese Chamber of Commerce (SCCC), Europe-Asia Case Study Center of the University of Zürich, China Competence Centre (CCC) of the University of St.Gallen and other institutions to launch a new SCCC Education Committee Knowledge Updates Newsletter.

The newsletter is aimed at making high-quality, academically proven and practically relevant articles by CEIBS faculty and other thoughts leaders available to a wider audience. Read on for a preview of a recent case by Xinhua Wittmann, Yuan Qin and Alessio Ricciuti (edited by Yang Mei) from the Europe-Asia Case Study Center at the University of Zurich.

Sunrise and Huawei: A partnership beyond the ordinary

5G stands for fifth generation; that is, the fifth iteration of mobile network technology. It is a global wireless standard that aims to go way beyond what the current 4G networks can do. Huawei, the 34-year-old Chinese telecom giant as well as a world leader in 5G technologies, has made its name in devices such as mainstream chips, terminals, and network vendors. Setting up 5G Joint Innovation Centers (JIC) around the world is a natural next step and at the same time part of the global strategy of Huawei.

When asked about the reason behind the setup of JICs, Jackie Huang, the deputy CEO of Huawei Switzerland, explained:

“Many people don’t have a proper understanding of 5G technology. How (should we) help operators to educate people? We not only focused on buying and selling; we also need to work together with operators to help them to use this technology to bring benefits to people.”

Indeed, although 5G is a very promising technology for the future of mobile applications, Huawei’s desire to promote its implementation through business and JICs has been met by various roadblocks. One major concern is the safety of the technology, due to a lack of knowledge. Some sceptics believe the technology may be harmful to people. Claims have been made that 5G, which uses high-frequency, millimetre-wave (mmWave) spectrum to deliver faster speeds, can cause radiation levels to be higher than what is considered safe.

Another roadblock for Huawei comes from fear. In a world with a myriad of devices connected via 5G technology, from manufacturing to power generation, some countries fear giving a foreign player control over that technology is too much exposure to possible sabotage to bear. In the United States, local firms are not permitted to do business with Huawei. Australia and New Zealand also have similar bans on use of Huawei’s 5G technology, and the UK announced in July that it too was not permitting UK mobile providers from buying new 5G equipment from Huawei by the end of 2021.

Despite the roadblocks Huawei’s 5G technology has encountered in some countries, Sunrise UPC, surprisingly, is very open and transparent about its partnership with Huawei. One could imagine that it was not just a matter of happenstance that Huawei wound up partnering with Sunrise to launch its first European 5G Joint Innovation Center (JIC) in Opfikon, Switzerland (Zurich). In fact, Sunrise’s trust in Huawei has been nurtured within the long-standing cooperation between the two companies.

For nearly a decade, Sunrise, as the second-largest telecommunications company in Switzerland, in order to compete with its key rival, Swisscom, the largest telecom company in Switzerland with mostly state investors, has been (since 2012) working hand-in-hand with Huawei to “continue its commitment to providing the best-of-class network service and user experience to its end users”. which was also the very reason why Sunrise chose Huawei as its technology supplier in modernizing its infrastructure. In its cooperation with Huawei, Sunrise has shown significant quality improvements in its products and services. Three years after Sunrise teamed up with Huawei, Elmar Grasser, CTO of Sunrise UPC commented:

“In the 2015 connect test, Sunrise showed for the 3rd time in a row the highest quality improvement on the Swiss market. Further, Sunrise achieved the highest ranking on voice services in Germany, Austria and Switzerland and will continue its successful cooperation with its technology partner Huawei.”

Cooperation on 5G technology between Sunrise and Huawei dates back to 2017. On December 12, 2017, Sunrise and Huawei carried out the world-first 5G demonstration within the 3.5 GHz (band 42) frequency band. Using a 5G antenna with 64X64 massive MIMO, a top download speed of 3.28 Gbit/s was recorded.  By the end of 2018, still an early phase for 5G technology, Sunrise had already become one of the few providers in the world able to make calls with 5G, thanks to its cooperation with Huawei.

In January of 2019, Huawei proposed setting up a 5G JIC in Switzerland in cooperation with Sunrise, and a collaboration protocol was agreed upon by both parties within two months. When asked about why Sunrise was so up to the cooperation, Alexander Lehrmann, Director of New Business Development and Innovation at Sunrise UPC, offered his explanation:

“The overall objective, to use the JIC to make the technology more tangible, is something that drives both companies (Huawei and Sunrise UPC). That idea would be on Sunrise side, on the Huawei side, on any company’s side. You know, you can talk so much on the PPT, you can talk so much face to face, but the best is, if you get to see certain solutions, certain products, that is just making it so much easier to communicate a message that drives your business cases.”

The fact that Sunrise UPC is based in Switzerland also facilitated the realization of the 5G JIC. As an early adopter of 5G technology, Switzerland is “the first country in Europe to start using a commercial 5G network for individuals in a limited way”.

In June of 2019, C-level executives from Sunrise paid a visit to Huawei’s headquarter in Shenzhen and signed the contract. Three months later, on October 14, 2019, the 5G JIC at Sunrise’s headquarter in Opfikon, Switzerland opened its doors to visitors. The quick progress on the JIC showed Sunrise’s ambition in becoming a leader in 5G technology. Jackie Huang said that the cooperation between the two was made possible because the vision and the strategy of both companies made for a good fit:

“Sunrise UPC is a company that focuses very much on quality. They put zero defects as their vision, providing best network and best services for their customers. To achieve this, they focus on innovation and provide the best technology. This is their strategy and vision. On the other hand, for us, our company’s core vision is to provide the best service and best technology to our customers, to serve our customers, the ‘customer-centric’ culture, so from the vision and from the strategy, these two are highly matched.”

By January 2021, the 5G JIC in Opfikon had already hosted more than 200 group visits, showcasing real-world use cases from smart farming to smartphone gaming to tourism to smart manufacturing. The success of the 5G JIC, located in the heart of Europe, will be “a showcase to the rest of world”, said Jackie Huang.

Stayed tune for the publication of the full case soon! In the meantime, if you would like to sign up for the SCCC Education Committee Knowledge Updates Newsletter or other CEIBS newsletters, click here.