Once upon a time, Huawei was a rising star on our shores. I told you about them in 2013, when their CES booth was packed. Their star shone brightly, but quickly dimmed. Just a few short months later I quoted them as a potential security risk. During the desperate drama of the Sprint purchase — which we strive so hard to forget — they were said to be loaded with spyware. It was just a few months ago that AT&T dropped them, and very recently Best Buy did the same.
Now it looks like the FCC is about to put a stop to all Huawei’s business in the US. The Verge quotes a Wall Street Journal article saying that they’re considering new action against both Huawei and ZTE, another Chinese company accused of planting spyware in its electronics. As soon as Monday, all federal subsidies for communications companies using Huawei and ZTE equipment could end. This would mean the end of Huawei’s business in the US.
The concerns of a global economy
There have been some concerns for years about using electronics equipment made overseas. The problem is it’s just been practically impossible to avoid. Both the iPhone and Galaxy phones are made overseas, and Samsung is itself a Korean company. However, this sort of rhetoric has stepped up quite a bit recently. The government essentially put a stop to Broadcom’s takeover of Qualcomm. Regardless of your opinion of that action, avoiding Huawei equipment does seem justified.
There has simply been too much evidence to ignore. All of it suggests that Huawei equipment could be providing sensitive information to the Chinese government. The real concern is the central office equipment used by the carriers themselves. However, even the company’s cell phones are just too much of a risk.
The real question here is whether this is the start of a protectionist trend that would drive all communications manufacturing back to the US, or if it is simply saber rattling between two governments that already have an uneasy relationship. While the thought of more American jobs seems like a great deal, it would likely triple or quadruple the cost of nearly every electronic item. That’s why a lot of that manufacturing moved to Asia in the first place.
Regardless, that’s a very long way off. Today, the real threat is Huawei and to some extent ZTE. Both companies stand accused by intelligence agencies all over the world of allowing “spying backdoors” that could allow a foreign government to see every bit of information passing through a Huawei or ZTE device. That’s a scary thing to consider and I for one think it makes sense to take this step now. I don’t always praise the FCC, but this particular step does make sense now that I have done a lot of research about it.
The effect on AT&T and other top carriers should be minimal. Some lesser rural carriers use Huawei and ZTE equipment but to my knowledge, AT&T does not.