The trade and tariff disputes with China are not stopping and are escalating. We’re going to hear a lot more about the digital curtain with China. This seems to be the only issue that the U.S. Democrats and Republicans seem to agree on.
What is the Digital Curtain?
The short answer is a digital technological divide between the US and China that started years ago but has intensified greatly recently due to President Trump’s assault on Huawei, China’s largest technological company.
The term “digital curtain” (aka “digital iron curtain”) is a take away from the “iron curtain” created in the early 1960s. The iron curtain is related to the cold war, a period of words and competition between the Soviet Bloc and China with the Western Allies led by the US. Competition comprised primarily nuclear build-up until Sputnik was launched in 1958 sparking the race to the moon. China and the US have been in an economic and technology completion for years. The 5 G technology evolution race started fairly recently has a resulted into a race between the US and China for technical dominance.
5 G Technology Evolution
The G in 5G means it is a new generation of wireless technology that will be: faster (moves more data); lower latency (to be more responsive); and the ability to connect a lot more devices (sensors and smart devices). The 5G technology is projected to be as big as another internet. The following items are some key things that need 5G technology to work:
- Artificial intelligence
- Driverless cars
- Internet of things
- Genomics
- Seaport automation
- Industrial robots
- Rural area smart phone coverage
- Home internet
- Faster smart phones
AT&T, Verizon, and other carriers are starting to launch 5G networks this year (2019). 5G applications are expected to be ready in 2021 and 2022. In the 5G market, Huawei is leading the US and European’s with the 5G rollout. It has a very aggressive management style that sets them apart.
China Position
“Made in China 2025” is a China initiative to reduce its dependence on foreign supplies of semiconductors and other key technologies. Huawei is the company China is counting on to lead the 5G evolution and their independence on foreign technology sources. They want to make their own chips, have their own run internet, and other key technologies.
The US believes that China will remain heavily dependent on us for years, as well as Japanese, and European suppliers and Taiwan for the fabrication of advanced chips. The belief in China that the US is lowering a digital curtain motivates them to be more intense and focused on becoming independent.
The on going tariff war and attack on Huawei reinforces their fears. China is creating a “Silicon Valley” and gigantic data center in preparation to becoming independent. China is developing plans to use its control (produces or owns 95% of worlds rare earth metals) of rare earth metals as a weapon in its quest for technical dominance of electrical vehicles, missiles, batteries and other technologies.
US Reaction
The US has accused China of ripping them off for decades. They also have had suspicion of Huawei espionage for years. Trump restricted American companies from selling to Huawei which greatly impacted their sales expectation and ability to buy US components. This action increased tensions between China and the US in their ongoing negotiations to resolve the trade balance. Trump’s “America First” fits with his accusations the China has been ripping the US off for decades. His slogan also led to the tariff war and Huawei restrictions.
Summary
If the US and China are headed for a second Cold War, there may be a “digital curtain” that divides them. More than likely, it will be a split divide with China and the companies that adopt their apps and the US and the countries that support theirs. There may be a China led internet and a US led intranet.
This scenario may happen but there a number of things that may prevent it from happening. These things are:
- China and the US need each other for a long time. China needs our semiconductors and other technologies. The US need their rare earth metals.
- For the first time China, US and the world have agreed on the 5G standards which is necessary to make 5G work worldwide.
- Some feel the US-China technology race looks like a new cold war but no countries have been persuaded to cut off one side or the other.
- The ongoing negotiations between China and the US hold a lot of promise to resolve the tariff war and the Huawei restriction successfully.
Assuming a digital curtain is avoided, rest assured China will still strive for independence and the US will continue to push the new technology envelope forward as they have done for over 200 years.
Bio:
John can be reached at: jwayers21@gmail.com.
John earned a BS in Mechanical Engineering and MS in Engineering Management from Northeastern University. He has a total of 44 years’ experience, 30 years with DOD Companies. He is a member of PMI (project Management Institute). John has managed numerous firm fixed price and cost plus large high technical development programs worth in excessive of $100M. He has extensive subcontract management experience domestically and foreign. John has held a number of positions over his career including: Director of Programs; Director of Operations; Program Manager; Project Engineer; Engineering Manager; and Design Engineer. His technical design areas of experience include: radar; mobile tactical communication systems; cryogenics; electronic packaging; material handling; antennas; x-ray technology; underwater vehicles; welding; structural analysis; and thermal analysis. He has experience in the following areas: design; manufacturing; test; integration; selloff; subcontract management; contracts; risk and opportunity management; and quality control. John is a certified six sigma specialist, certified level 2 EVM (earned value management) specialist; certified CAM (cost control manager).