How China became the standard maker
How China became the standard maker
WRITTEN BY PHILIP LOTT
11 October 2022
At the end of September, the International Telecommunication Union (ITU) member states selected Doreen Bogdan-Martin of the US as the next Secretary-General in the “most important election you never heard of”. More than 150 years old, the ITU is a UN agency that sets technical standards for a large part of global communications and digital infrastructures. In a change from previous election cycles, this year’s Plenipotentiary Conference decision over the ITU’s leadership was more than ever perceived as a “fight over who should control the internet”.
A part of the commotion at the ITU might be attributed to Russia’s invasion of Ukraine, as Bogdan-Martin’s opponent for the top post was Russian national Rashid Ismailov. However, attention for the leadership contest had more to do with the tenure of outgoing ITU Secretary-General Houlin Zhao, a former Chinese official. The unusually close coordination between the US and EU in the run-up to the elections clearly indicates concerns over China’s growing influence in technical standardisation and internet governance.
Under Houlin Zhao’s leadership, the ITU went from a rather unknown or at least under-the-radar standardisation organisation to one of the key locales of the intensifying geopolitical competition between China and the US, as well as Western democracies overall. Therefore, it is high time to take stock of Houlin Zhao’s leadership of the ITU since 2015 and take a closer look at what it teaches us about China’s ambitions in international organisations. The ITU presents a prime example of how China’s behaviour has changed the institutional dynamics from within and puts pressure on the liberal underpinnings of standardisation.
Lessons learned
Traditionally, Western — especially European — companies and countries have been successful in global standard-setting and long-dominated standards developing organisations (SDOs). A standard can be understood as a “recipe” for technologies, intended to ensure global interoperability and prevent the fragmentation of markets. While mostly not legally binding, standards — like laws or regulations — form an integral part of the liberal trade order and are hard to circumvent. The liberal compromise of standardisation is characterised by the general openness of the process and the participation of an array of actors, including the private sector. The central “premise” of the standardisation system is that any actor can participate as a stakeholder in some form. The openness of standardisation aims at creating “inclusive” processes and solutions.
The International Telecommunication Union presents a prime example of how China’s behaviour has changed the institutional dynamics from within and puts pressure on the liberal underpinnings of standardisation.
In 2003, China learned a painful lesson when its domestic standard failed to replace the globally accepted Wi-Fi standard. Since then, Beijing has undertaken far-reaching reforms of its domestic standardisation system in order to improve its prospects on world markets. Nonetheless, Chinese companies still pay “tens of billions of dollars in royalty fees” to (mostly Western) firms that developed standards earlier on. The evolving Chinese standardisation system is rooted in its history of planned economy and emphasises state control.
At the same time, it has emerged as a hybrid approach due to a “partial convergence” with the European approach to standardisation while remaining state-centred. This can be partly attributed to knowledge exchanges with countries such as Germany that have been leading in standardisation for decades. However, changes in China’s standardisation approach such as the 2017 Standardisation Law or the China Standards 2035 strategy go beyond adapting its regulatory environment. Beijing has been actively encouraging Chinese companies to increase their engagement in SDOs, which has been accompanied by outsized R&D spending.
Additionally, China has strengthened its position in standardisation through the presence of Chinese nationals in strategic leadership positions including the International Organization for Standardization (ISO) and the International Electrotechnical Commission (IEC). The ITU has been a focal point of China’s efforts due to its position in the UN system with a more prominent role for state actors. Prior to assuming his position as ITU Secretary-General, Houlin Zhao had already criticised the role of the Internet Corporation for Assigned Names and Numbers in internet governance, while arguing for a stronger ITU involvement.
Houlin Zhao’s legacy
Leadership positions matter due to their translation into “considerable agenda-setting power”. During his tenure as ITU Secretary-General, Houlin Zhao advanced close cooperation between China and the ITU, which resulted in the questioning of his loyalties and neutrality. Under his leadership, the ITU signed a memorandum of understanding with China in the context of the Belt and Road initiative (BRI) and the Digital Silk Road to support developing countries. While partnerships to advance global connectivity are not uncommon, China’s intentions to “monopolize future communications infrastructure” have remained unaddressed by the ITU. Additionally, Zhao voiced support for Chinese telecom giant Huawei in discussions over alleged security concerns in the area of 5G technology and praised it as a “blueprint for an internet architecture”. In this context, he accused the US of a “loser’s attitude” due to its opposition to including Huawei equipment in 5G infrastructure over security concerns.
Through its leadership positions, China has been able to secure a prominent position in developing and setting parameters for standardisation processes. Houlin Zhao is only the most visible example. China also holds a significant and increasing number of technical leadership positions: Beijing heads the most ITU Study Groups and also has the largest share of ITU Focus Group management positions. Taking into account membership at ITU and ITU Telecommunication Standardization Sector (ITU-T), China places second to the US followed by European countries and Japan.
Chinese entities also lead in terms of leadership roles in the Working Parties with the largest share of chair, vice-chair, and rapporteur appointments. This assessment also holds true for the much discussed standardisation of 5G: in the ITU’s 5G-related bodies, China held the largest share of (vice-) chair positions, with eight out of 39 leadership roles in September 2018. Technical leadership roles are more impactful as they influence the standardisation process more concretely. This demonstrates China’s “well-known understanding of bureaucratic processes”, as well as the influence of agenda setting and procedural rules on the ultimate outcomes.
Something out of the ordinary
US officials have been particularly critical of China’s behaviour in SDOs. Representatives of the US Federal Communications Commission state that Chinese entities “have loaded up the voting to try to get their particular candidates on board, and their particular standards”. Nonetheless, China has been open about its intention to become more involved in standardisation and increasing its share of leadership positions is an obvious step towards this end. Beijing also contends that its share of leadership positions should be roughly equal to the US or the EU and until today, China — as the second largest economy in the world — has not achieved a proportional share of leadership positions.
So far, the embedded liberalism of standardisation has succeeded in providing the optimal selection of technical solutions while preventing market fragmentation. China’s growing presence at the ITU increasingly undermines and contradicts these liberal tenants. While governments mostly take a backseat to private actors in standardisation negotiations, the Chinese government ensures that Chinese companies and entities speak with one voice, which has led some to accuse the Chinese government of coercion. For instance, the Chinese company Lenovo was reprimanded in China after its representatives decided to vote for a proposal by Qualcomm instead of a competing Huawei proposal. According to several reports, Chinese authorities go as far as demanding “smartphone pictures from [their] delegates as proof” of their voting behaviour.
The volume of standard contributions and proposals coming from Chinese entities has also resulted in the accusation that China intends to “flood the zone”. While Chinese companies have steadily and rapidly increased their presence in negotiations due to support and incentives provided by the Chinese government, Western companies are left “with little if any state support” to contribute and participate actively in standardisation.
Too little, too late
The success of China’s contributions during 5G standardisation served as a wake-up call for governments in the US and across Europe. This also included the realisation that their once-dominant position was increasingly under pressure. While Western governments scramble for a united response, China has already set its sights on 6G as the next big thing. At the ITU, China is already securing a prominent position in discussions on technologies beyond 5G. A Huawei representative was selected as the chairman of the focus group “Technologies for Network 2030” as part of ITU-T Study Group 13, which will look into future technologies such as 6G.
The election of Doreen Bogdan-Martin as Secretary-General, as well as Lithuanian national Tomas Lamanauskas as Deputy Secretary-General, are the result of a newfound transatlantic unity. They express the realisation that ensuring freedom and openness in standardisation requires stronger engagement by the US, Europe, and liberal allies within SDOs. To keep up with China (but also Russia), ‘recipes’ of the past are no longer enough and novel approaches are needed. Therefore, this election cannot be more than a first step. The European Commission’s Standardisation Strategy already clearly outlines a change in ambition and approach on the European side, which allows for a more engaged role of the Commission.
The EU–US Trade and Technology Council (TTC) offers a unique forum and a promising tool to develop common positions and policies across the Atlantic. However, government action is only one side of the coin; the US and Europe should engage and involve companies and non-governmental actors that are a crucial component of the standardisation ecosystem. Taken together, these measures and formats should enable liberal democracies to take a more robust stance when it comes to technology standards amid intensifying geopolitical competition.
DISCLAIMER: All views expressed are those of the writer and do not necessarily represent that of the 9DASHLINE.com platform.
Author biography
Philip Lott is a Program Officer at the Aspen Institute Germany. His primary research interests are emerging security challenges in the transatlantic and Indo-Pacific contexts including energy and climate security or digital governance. He is also an assistant editor at 9DASHLINE. He writes in a personal capacity. Image credit: Flickr/ITU Pictures.