For the past few
years, Cisco Systems and other telecom hardware manufacturers have been
successful at convincing American businesses, telecoms, and government agencies
to stay away from Huawei and ZTE products for fear of industrial and
communications espionage by Chinese organizations and authorities. So far the
market share of Huawei products in the United States has dropped to a record
low of 5%.
Huawei has been
workin hard to fight the allegations, claiming that security concerns are
unfounded and that the company has been caught in a "trade conflict"
between the US and China. Earlier this month, during UBM’s Interop conference
in Las Vegas, Patrick Zhang, president of the marketing and solutions
department at Huawei, claimed that the company is now trying to regain its
rightful place in the US market, fighting the "fear of Huawei." Zhang
said, "It's a challenge, but we will prove ourselves with our good
solutions. We will bring our differentiated technology and solutions and prove
ourselves with some good references."
In addition,
Huawei has offered the US, Australian, and several European governments
complete and unrestricted access to its software source code and equipment. But
there is still long-term damage to the relationship to overcome.
The irony,
however, is that documents leaked by former NSA analyst Edward Snowden and
published last month suggest that the US government was actually involved in
hacking Huawei network equipment in order to spy on China and other countries,
including US allies, using Huawei hardware. While it is widely believed that US
intelligence agencies have for years been seeking the collaboration of
technology companies, including Cisco, to spy on foreign targets, this is the
first time that the hacking activities of the NSA involving a foreign
manufacturer have been exposed.
Huawei has
extensive experience managing wireless networks, and many US telecoms
executives are privately concerned that not being able to use Huawei equipment
and software will be extremely costly, because they need to upgrade their
networks for the increased demand in data traffic.
What the US is
losing in competitiveness, Europe is gaining.
"Our core
business principle in Europe is to achieve mutual benefits and win-win
outcomes," said Ken Hu, Huawei's deputy chairman and rotating CEO, at
World Economic Forum Annual Meeting 2014 in Davos. There is no doubt within the
intelligence community that the Chinese government is involved in extensive
cyber-espionage operations, and China does more of it than all the other
countries combined. But Huawei cannot be held responsible for the hacking
activities of the Chinese and US government on Huawei products. The company is
the second largest manufacturer of telecom equipment and the fifth most
innovative company in the world, and they can’t afford to lose more business
because of security allegations.
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