Huawei Responds to Latest U.S. Action

Posted on May 19, 2020 by Paul Thurrott in Cloud, Hardware, Mobile with 3 Comments

In the wake of yet another political attack from the United States, Huawei argued this week for “cooperation over competition.”

As I’m sure you know, the United States purportedly sees Huawei as a national security risk because of its ties to China. And it placed the firm on a so-called Entity list, effectively preventing it from doing business with companies in this country. Since that time, however, the U.S. has repeatedly extended the deadline by which some companies, in particular rural Internet providers that rely on Huawei equipment, must stop interacting with Huawei. And Huawei has found ways around the blacklisting by exploiting loopholes that allow it to ship components in its phones that were made by U.S. companies outside of the country.

This past week, the U.S. launched its latest salvo against Huawei by attempting to cut off those loopholes via export controls that prevent component makers from shipping hardware to Huawei regardless of place of manufacture without express permission from the government. There’s a 120-day grace period, after which time the new export controls will be enforced.

Appearing at the firm’s annual Global Analyst Summit this week—yes, it’s a virtual event this year— Huawei Chairman Guo Ping said that the moves place Huawei in an awkward position that forces it to focus on its very survival.

“Over the past year, many technologies became unavailable to us,” he said. “Despite this, Huawei struggled to survive and is striving to move forward.”

“Today the world is an integrated collaborative system,” he continued. “The trend of globalization shouldn’t and will not likely be reversed. Fragmented standards and supply chains benefit no one, and further fragmentation will have a severe impact on the entire industry. The industry as a whole should work together to strengthen [intellectual property] protection, safeguard fair competition, protect unified global standards, and promote a collaborative global supply chain.”

Huawei is also alleging that the U.S. actions against the company are really about artificially ensuring that tech giants based in that country can maintain their technological leadership, and is not about bogus espionage worries.

“[Mr. Guo] is unsure why the U.S. is attacking Huawei, there is no reason to do so,” a Huawei statement explains. “Mr. Guo has recently reviewed U.S. senior leaders’ recent speeches which showed they viewed technological leadership as the foundation of America’s supremacy. Other countries or companies which put this at risk were viewed as threats, and Huawei had [Information and Communications Technology] leadership.”

And Huawei may soon get the aggressive backing of the Chinese government, which has finally threated to put Apple and other U.S technology firms on its own “unreliable entity list,” which could cut them off from their critical China-based manufacturing partners.  That kind of escalation could amount to a new Cold War pitting the United States against China.

But the bigger risk, perhaps, is that this battle could finally push China-based technology giants to drop U.S. software and hardware and push forward with their own solutions. The net effect could be devastating to the U.S.-based tech giants that their government is allegedly trying to protect.

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