The U.S. House of Representatives Permanent Select Committee on Intelligence recently issued a positively scathing report on Chinese telecommunications equipment giants Huawei and ZTE that basically suggested, yeah, um, let's go with this: U.S. companies should not buy equipment from these two vendors. They cited, among other factors, a lack of transparency in the Committee's dealings with representatives of these two firms, and allegations of impropriety.
With no hard evidence presented, the U.S. government is using little more than suspicion and innuendo to accuse both Chinese firms of being fronts for the government of China and its military. The cellular base station as an instrument of foreign intelligence? This from a government that already claims the right to intercept any traffic it wants (presumably with a court order, of course)?
OK, I was a political-science major before I switched to technology, and I was active in politics, including elective office, for many years before getting on with other matters. I've held government security clearances and I strongly believe that the U.S. government and military should absolutely buy American. But I also believe in a global economy and that ultimately, world peace and prosperity depend upon global economic progress, yes, through global competition.
[ For more on Congress's concerns with Huawei and ZTE, read Why Huawei Has Congress Worried. ]
It would be one thing if the U.S. government had hard evidence with which to charge these offshore firms, but what we have here appears to be little more than thinly disguised protectionism, paranoia, and borderline psychosis from an institution that itself has no problem with running up $1 trillion in new debt every year, has approval ratings from its own constituents barely above zero, and lacks the technical and business skills to have even a clue what it's talking about.
Really, who's kidding whom here? Is this simply the groundwork for the Alcatel-Lucent and Ericsson Full-Employment Act? That's right; we don't make cellular base stations here anymore.
Now, I'm not saying that the companies in question haven't done anything wrong. But I, too, have no hard data one way or the other.
As you've no doubt heard, there's already a good deal of controversy surrounding Huawei. Perhaps you saw the "60 Minutes" piece on October 7. Essentially, criticism of the company revolves around two core claims: that Huawei steals intellectual property, and that the firm is a front for the Chinese army and/or government.
Again, I have no reliable data on either of these, but I do understand the concern. China is an emerging economic power, and throughout history, some emerging economic powers have sometimes engaged in activities that in retrospect were bad ideas--not the least of which were slavery and the wholesale slaughter of indigenous peoples, just for example. While the theft of IP and hidden motives are indeed serious concerns, we most certainly do not have anything unusual going on here. Misappropriation of IP occurs throughout our industry, from an inadvertent violation of patent rights to a programmer using a proprietary technique learned at a past job for a new employer--and we have mechanisms for redress in place.
But most importantly, keep in mind that Huawei is a $30+ billion firm, and it is simply beyond comprehension that such a company would risk everything--literally everything--and that the government of China would risk war--yes, war--by committing acts that are clearly overt threats to others, including customers, users, and/or foreign governments.
Let's suppose, just for example, that Huawei has logic deep in its custom chips that seeks out sensitive data and forwards it to secret locations. Could anyone honestly believe that this activity wouldn't eventually be detected? And the very least of the consequences of such shenanigans would likely be an immediate reprisal at the governmental level, effectively putting the company out of business. Think what would happen if Alcatel-Lucent, or Cisco, or Enterasys, or Ericsson, or any other company did something like this--such would not be recoverable. The management of Huawei certainly knows this, no matter what the Chinese government might desire or even demand.
Politics is one of the most important elements of human culture, and it should never be discounted or underestimated--indeed, consider how the current domestic election cycle is reshaping America itself. But politics translated into technology can't be kept secret or strategic for very long. For now, and until an offshore equipment supplier is unequivocally exposed as an agent of a foreign power, it deserves the benefit of the doubt, with the company's products and services evaluated on their technical, business, and financial merits alone.
Just my two cents, of course, but all of us--customers, users, and residents of this planet--are better off when we just stick to the facts. And dear members of Congress, you lack those at present.
Note: neither Huawei nor ZTE are clients of Farpoint Group.
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