Huawei, the largest Chinese telecom equipment vendor, seems to be
loosening its grip in various economies due to security reasons.
Though the governments in the US and India are not favoring the presence
of Huawei due to security aspects, private operators in these nations prefer
the Chinese vendor.
Recently, the U.S government barred
Huawei from participating
in a nationwide emergency program called Public Safety 700-MHz Demonstration
Network. Huawei sought explanation from the government for barring the Chinese
equipment maker from participating. America is an important market, where
Huawei is pinning hopes for its newly launched enterprise business competing
against American grown Cisco.
The private telecom market has a different
story to talk about Huawei. At the CTIA Enterprise & Applications
Conference and Expo 2011 in San Diego, California, Huawei
said it is experiencing rapid growth in the U.S. after strategically launching
multiple devices into carriers. The growth is attributable to private telecom
operators.
The American bundled mobile phone market was a virgin market for Huawei
for some time. At present, Huawei can talk about success after introducing
multiple devices into carriers including T-Mobile, SpringBoard with
Google, T-Mobile Sonic 4G Mobile Hotspot, T-Mobile’s fastest 4G mobile hotspot,
Impulse 4G, Huawei’s first affordable Android-based smartphone into AT&T
Wireless; and the Huawei Ascend II, the successor to Cricket Wireless
deployment of its first low-cost Android device.
Recently,
the U.S. committee on foreign investment prompted Huawei in February to
wind-down its purchase of Santa Clara, California-based 3Leaf Systems’ patents
after U.S. lawmakers said the acquisition could be a serious risk for U.S.
computer networks.
Huawei failed to fetch agreements of two U.S assets on the grounds
of sellers’ belief that Huawei won’t be able to win U.S. government approval to
acquire software supplier 2Wire and Motorola’s wireless business last year and
3Com, a computer-equipment maker in 2008.
These
decisions have the potential to endanger Huawei’s long-term investment plans in
the US, where it employs 1,500 workers and spent $6.1 billion last year on
goods and services.
Akin to U.S step, Indian telecommunications
department has asked the state-run BSNL to not to select any Chinese vendor
(Huawei and ZTE) for its Rs 5,000 crore contract for 15 million GSM lines.
But on the other side of it, Bharti Airtel, a private telecom operator, seems
to have selected Huawei for rolling-out their largest LTE TDD network in
Karnataka circle which is one of those four circles which they acquired last
year’s BWA auction. Indian telecommunication department mentions
security reasons to take the drastic step.
Though, US have not elaborated on what
grounds it excluded Huawei from the program. Media reports suggest that Huawei
has links with the China’s military and this is a major issue for the American
government.
Huawei’s annual report suggests that it is an
employee-owned company and the Chinese government does not hold any shares. The
company has headcount of 110,000 employees worldwide.
While the U.S and Indian governments are
skeptical about security issues related to the Chinese vendor, Huawei is
strengthening its presence in private sector. The company is strengthening its
presence in emerging markets like the Middle East, Africa and India.
Since the inception of Huawei’s North
American headquarters in Texas in 2001, the company has been successful.
Recently, Huawei was selected by United Wireless to swap out the existing network and install its SingleRAN
wireless solution in Kansas to support the infrastructure needs of its
customers.
Also the company is listed as the World’s Most Respected Companies
compiled by The Reputation Institute and published by Forbes magazine. Is there
any mismatch between perception and action? Several Indian telecom operators
benefited from Huawei technologies. Why these governments have different
strategies?
By Rashi Varshney
editor@telecomlead.com