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Huawei, Failing to Crack U.S. Market, Signals a Change in Tactics (nytimes.com)
97 points by johnny313 on April 17, 2018 | hide | past | favorite | 67 comments


On a related note, the other Chinese telecom devices provider ZTE looks to be half dead - ZTE will probably lose Android licensing soon. https://www.cnet.com/news/zte-may-lose-android-licensing-fro... And lose access to vital parts for 7-10 years.

Huawei will most likely try to focus its attention on Europe and Asia. However, other countries might follow suit with US soon, following FCC's proposal to withhold money from suppliers (such as Huawei). https://www.fiercewireless.com/wireless/huawei-moving-from-u...

South Korea, for example, has started questioning Huawei's close ties with the CCP https://venturebeat.com/2018/04/03/south-korean-carriers-fac...

looks like Nokia, Ericsson, and Samsung will be the winners here, with Samsung most likely winning the 5G race in US, and Nokia/Ericsson in Europe


Ironically the UK let Huawei to build and run it’s most secure networks it even has access to the doughnut.

https://www.telegraph.co.uk/technology/2018/02/20/uk-cyber-s...

This is despite multiple failures including the inability to verify the source code and binaries that end up running on the hardware that is supplied, operated and managed by Huawei.

https://assets.publishing.service.gov.uk/government/uploads/...

(Page 15 is a gem so are many others).


Huawei has lots of big customers in Germany and invests big money into 5G. I think nobody can compete with Huawei in Germany. Huawei themselves see ZTE as a big competitor in China and they also think they already "won" the race in Germany. You need lots of money to change the infrastructure to some other hardware provider. And I think noone can compete with Huawei's prices.


Evidence that Huawei has deep ties to the Ministry of State Security and Third People's Liberation Army - the CIA and NSA respectively for China - is public and well documented [1][2][3][4]. The argument goes, that if widely adopted in the US, Huawei/ZTE would pose a national security risk. As a result, the US wants to put barriers to the adoption of their technology in the US.

It's worth having the debate about the merits of this argument, and resulting stances/actions taken by the USG.

[1] https://intelligence.house.gov/sites/intelligence.house.gov/...

[2] http://foreignpolicy.com/2017/11/30/feds-quietly-reveal-chin...

[3] https://www.washingtontimes.com/news/2011/oct/11/chinese-tel...


Do you think the same argument, if applied more generally, would lead towards the exclusion of all foreign tech companies from all nations? Thinking here of the deep ties between Google, Amazon, Facebook, PayPal and the US military-industrial complex.


> the deep ties between Google, Amazon, Facebook, PayPal and the US military-industrial complex

False equivalence. Google et al exist in a system where private actors can challenge the government. ZTE and Huawei are arms of a government which recently devolved into a dictatorship. One can be trusted to, most of the time, follow commercial logic; the other, geopolitical logic.


Noone can challenge the government on the basis of laws, as they can be changed as needed or mechanisms introduced to ammend the law (e.g. FISA courts). You can never win against someone who can change the rules.

You can base your challenge on the constitution, but amendments show that although harder to change it isn't rock solid either, and you challenging the government is based on the interpretation of the constitution by judges (e.g. current US gun law constitution interpretion of militias).

You can base your challenge on human rights, but the US might leave the UN and doesn't care either way. The situation is a little bit better in Europe with the ECJ, where goverments can be challenged outside the framework where they make the rules.

Companies are always maximizing profits in an environment, if this means playing by the intention of the law makers, then that's it [1]. If standing up to the government because it enhances its brand (Apple security) companies will do that.

Granted, China pushes companies more then the US does, but it's not a difference in quality but quantity.

[1] https://www.theguardian.com/world/interactive/2013/nov/01/ns...


Quantity had a quality all its own.

I'm a big fan of comparing Tienanmin Square to various US responses to student protests, but really, there is a difference.


> False equivalence. Google et al exist in a system where private actors can challenge the government.

Theoretically they can, but the question of whether they do or will question the government is very different.

For example, what are the ties between NSA and Facebook ?


Far from recently. It's simply returning to its original Stalinesque ways.


Indeed it would and in fact largely is, especially in the case of China. For a long time Google was banned and Facebook remains so. Only with massive efforts has Google been able to somewhat operate there.


Let's we all forget aurora and the role that played.


US issues national security letters to US based cloud companies for access to data, and has tried to force a US company (Apple) to create back doors to its encryption.

This is perspective on at least one major reason companies like Facebook and Google were blocked in China.

If all Chinese people developed a habit of using Facebook it would essentially (in theory at least) allow the US government to spy on Chinese citizens.


> US issues national security letters to US based cloud companies for access to data

NSLs can only be used to get non-content data, like whom an email was sent from and to. China intercepts and filters the actual content of all communication. https://www.google.com/amp/s/qz.com/960948/what-happens-when...

> and has tried to force a US company (Apple) to create back doors to its encryption.

Apple had a "backdoor" to access data on its own phones via installing a build that disabled password attempt throttling. The FBI simply asked Apple to use its backdoor on the FBI's behalf, not to create a new backdoor that the FBI could use on its own. In China, Apple acceded to the government's demands to block any VPN service that prevents front door access by the government. https://www.google.com/amp/s/techcrunch.com/2017/07/30/apple...


> NSLs can only be used to get non-content data, like whom an email was sent from and to. China intercepts and filters the actual content of all communication. https://www.google.com/amp/s/qz.com/960948/what-happens-when....

There's also the fact that the NSA has been archiving all data. Even if the law says the government can't do something with that data, or that NSLs can only be used to get non-content data, laws can change on a whim, while Facebook's dominance of a market cannot be easily removed. How effective do you think China suing the US for breaking or changing a law would be, if the whole point of the law is to leverage power against a nation? The possibility exists for potential antagonistic use if the data is stored in the US or owned by a US company, as everything in the US is under US jurisdiction.

If I have a gun pointed at your head and you tell me your current laws say that you will not use the gun against me if I give it to you, why would I believe you? Once I give you the gun, you have the power and will no longer need to follow your own laws.

> Apple had a "backdoor" to access data on its own phones via installing a build that disabled password attempt throttling. The FBI simply asked Apple to use its backdoor on the FBI's behalf, not to create a new backdoor that the FBI could use on its own. In China, Apple acceded to the government's demands to block any VPN service that prevents front door access by the government. https://www.google.com/amp/s/techcrunch.com/2017/07/30/apple....

This is not true. Please provide a source (I was unable to locate one).


> There's also the fact that the NSA has been archiving all data.

The NSA has done no such thing in the US. It has archived data in war zones according to leaks, but such areas have suspension of many human rights, to the point where this is a minor one.

> This is not true. Please provide a source (I was unable to locate one).

You included the link to my source in your quote.


> Apple had a "backdoor" to access data on its own phones via installing a build that disabled password attempt throttling. The FBI simply asked Apple to use its backdoor on the FBI's behalf, not to create a new backdoor that the FBI could use on its own.

Source? My understanding is the exact opposite. Apple had not backdoor, but the FBI wanted it to create one like the one you described for it.


Apple's backdoor is its ability to install such a build. Creating such a build is trivial (just delete the throttle check or increase the constant that controls the throttling to a very large value).


> This is perspective on at least one major reason companies like Facebook and Google were blocked in China

There is zero correlation between security and being blocked in China. There is a strong correlation between competing with politically-connected Chinese entities and getting blocked / being forced to surrender key IP. The backdoor argument is a red herring.


As much as its fashionable to hate on China and its government, it's important to understand that Foreign government social manipulation of citizen and instigate chaos is real and it's not limited to US or western countries or only through the internet. As someone who owns and runs an ISP, I see governments in many countries, through my peers in the industry, (including developed, developing and poor countries), go through great lengths to tighten the screws on the internet in their respective countries. While very few countries do it as intrusively as China - most countries do it at some intrusive degrees, with laws and regulations.

Political destabilizing through the internet is a real thing and has been for many years and as more companies rely heavily on the internet for their business - stability of the internet infrastructure is very much tied to individual countries economic health and faith.

Does China go too far in regulating their internet? Most probably yes.

Is China's internet policy completely unreasonable on unfounded security grounds? Abso-fucking-lutely not.

The problem is no one really knows what the middle ground between the openness of the internet and policing it just the right amount. So we end up with an extreme case like China.


> Political destabilizing through the internet is a real thing and has been for many years and as more companies rely heavily on the internet for their business

This argument would hold water if China's Internet policies were unique to telecom. They're not. The same instruments which protected Baidu and Tencent promote local steelmakers, phone makers, car manufacturers, battery and solar panel manufacturers and every other industry with a Princeling [1] attached.

> As much as its fashionable to hate on China and its government

Putting this at the end because it's a semantic comment. This is a silly way to attempt to dismiss a valid argument.

[1] https://en.wikipedia.org/wiki/Princelings


As an aside:

> it's a semantic comment.

Is this correct usage? I read that as "it's a meaningful comment" which seems opposite to the intended use.


> This argument would hold water if China's Internet policies were unique to telecom. They're not. The same instruments which protected Baidu and Tencent promote local steelmakers, phone makers, car manufacturers, battery and solar panel manufacturers and every other industry with a Princeling [1] attached.

For the most part the country is economically and socially stable and improving at rapid pace. Yes the country has its share of problems, but name me one country, democratic, developed or otherwise that doesnt have their share of problems.

The American/Western exceptionalism attitude towards other countries is kinda nauseatic.

China is not going around rigging pro-western government democratic countries election. Funding uprising and waging wars directly or directly (at least not at the scale USA is). Russia tried openning up their country and we know what happened to them, China may one day become more open but can't really blame them for being sceptical of the rest of the world.


>The American/Western exceptionalism attitude towards other countries is kinda nauseatic.

So too is the "everyone's on aggregate just as bad as each other and everything is the same" equivocating approach to evaluating different countries and their systems.

>For the most part the country is economically and socially stable and improving at rapid pace. Yes the country has its share of problems, but name me one country, democratic, developed or otherwise that doesnt have their share of problems.

Nobody is saying Western countries are perfect. We just have the confidence in liberal democracy to at least say it is at least vastly superior to the dystopia China currently is. To say "China is improving at a rapid pace" is myopic. If you only care about economic development, then you are right, but if you care about civil liberties and human rights, then you could not be more wrong.


If competition with Chinese companies were the reason, Amazon, Apple, Bing and so on wouldn't be available in China either.

The difference between those and and the sites that are blocked (not just Facebook and Google, but also international newspapers) is that they cooperate with the Chinese government by censoring their websites, and the others do not.

Economically, Chinese social media isn't very relevant to the government. Since they are not exporting anything, protectionism in that sector doesn't really pay off. But being able to control what the populace can see and hear about the world is very important to them.

So the major reason for the internet blocks is security. It's the security of the state against its own citizens, but security nonetheless.


Isn't this comparison a little disingenuous? The scale, scope, and legality of government surveillance (not to mention censorship) in the U.S. absolutely pales in comparison to the situation in China.

If all Chinese people developed a habit of using Facebook, perhaps they could openly criticize aspects of both the U.S. and Chinese governments, instead of just the former.

EDIT: I'm not surprised to see downvotes when the top-voted comment on this link (which is about a Chinese company getting into the U.S., and has nothing directly to do with Google or Facebook being blocked in China) is essentially, "And you are lynching Negroes" [0].

If anyone would care to disagree with words, I'd love to hear your reasoning or relevant experience.

[0] https://en.wikipedia.org/wiki/And_you_are_lynching_Negroes


>>This is perspective on at least one major reason companies like Facebook and Google were blocked in China.

Uh huh is the phrase.

China, like USA and every major country, wants total (and ideally exclusive) control. China can never have that so they banned FB and Google. Chinese versions popped up and they are not missing anything.

I use FB occasionally, and have zero Chinese friends, or Egyptian for that matter. A "FB" clone can do extremely well in just one country; those that have many friends and family in China can join FB clones from Canada, Germany or wherever they are from.


> Chinese versions popped up and they are not missing anything.

They're missing the censored content that the CCP wants to suppress.


Being a user of both weibo and VK (living in both Russia and China), most people don't care what's missing, take that how you wish :)


> most people don't care what's missing

That's a misleading metric, as I'd assume "most people" in any country mostly care about sharing lowbrow content on social media.

Also it's hard to consciously miss what you don't know exists. Apparently some of the sensitive topics in China have been so suppressed that many younger people aren't even aware of them and have few ways of finding out.


For all we know Apple complied, and the relevant TLA created a media storm about how they didn't in order to convince people, who they wanted to watch, to use Apple.


It'd be easier to compromise an engineer with data they have already gathered than to force Apple to comply with such an order from the top down.

Anarchy is in Apple's DNA, and I have to believe there are still a few of the old guard hanging around that word would get out in such an event.


I once bought a Chinese brand tablet and it turned out to have a malicious root installed. Why would I even think of buying a Huawei phone when there are rumors that they have spyware installed?


Because you're in the 99% of the population who don't care?

GCHQ are already spying on me, along with every bank, social media company, large business, ... China can know about my inane existence too.

Chinese companies probably made all the network infrastructure already. My ISP uses Chinese made routers.


You may not care who knows, but I bet you would not put up with the slowness of the device because of the spyware feeding everything to the other side of the planet.

And when China starts doing something with your credit card info, I bet you drop your Chinese devices.


> buys a chinesium tablet with a rootkit > assumes all chinese devices are compromised China's a big country with a lot of companies, I wouldn't lump them all together.


>China's a big country with a lot of companies

owned and controlled directly or indirectly by their government, an authoritarian dictatorship. It’s disingenuous to pretend Chiba is just another market of competing private companies.


While Huawei is probably indirectly controlled and owned by the PLA, many Chinese companies are not owned by the state, like Tencent.


You don't need to be owned by the state to follow commands from it.


Yes, but that isn’t unique to China or even authoritarian economies. It’s definitely a shade of grey thing.


What tablet is not made in China?

My young daughter has a T3 Media pad and it has been the best tablet in that price range she has had and hasn't been destroyed so far.


Samsung tablets.


Because if you live in the your government, companies and individuals in your country will have much harder time getting your data from the Chinese, than from the US or other western companies you can "trust".

/s


I would be happy to see us follow suit up here in Canada, but given that JT is at least part-owned by the PRC, I doubt it'll happen. I miss the good old days when we had our own telecoms equipment manufacturer. Northern Telecom, for all its faults, put out good stuff.


> Northern Telecom, for all its faults, put out good stuff

Yeah and then suddenly a Chinese company called Huawei started releasing very similar products with a fraction of the R&D budget. I wonder how they pulled that off.

http://www.cbc.ca/news/politics/former-nortel-exec-warns-aga...


Modern Western culture says buy the cheapest now and don’t bother to think about the long term consequences. Including chucking into a landfill and buying a new one a year later.

On every level, be hollowing out our economies, pollution, loss of national autonomy, Western citizens have dug their - our - own graves.


Oh. That is why we hear lots of Huawei ads on French radio all of a sudden. (I don't have a TV but I guess it's the same there) I noticed it, and it felt weird. Now I understand better :

The US market is gone, so they target the EU market more aggressively now.


I'm really disappointed by this. To my knowledge, the upcoming Matebook X Pro was the only non-Apple device that has a taller than 16x9 aspect ratio and Thunderbolt 3. These are two criteria that are fairly important to me.


QQ: If I were to wipe a Huawei latptop and install Ubuntu, is my device still vulnerable to malicious rootkts etc. what if I swapped out the harddrive. The Matebook X looks very tempting . and someone has already got this work to with Debian https://github.com/lidel/linux-on-huawei-matebook-x-2017


> If I were to wipe a Huawei latptop and install Ubuntu, is my device still vulnerable to malicious rootkts etc. what if I swapped out the harddrive.

If the rootkit is in the firmware or BIOS, you'd still be vulnerable.


Got a Huawei phone, it sucks, they have disabled lots of software features (OTG, MHL, miracast) just to make you pay for them in a more expensive model


Sounds like your phone sucks because you paid the amount a sucky phone sells for in your market?

I've got a cheap Huawei ("Honor"), so far it seems no better or worse than other same price phones. Probably slightly better value than most tbh. It does miracast, which is default in Android since 4.4 I think (?), no idea about USB-OTG or connecting to HDMI.

Only problem I have is how to pronounce the name "ho-nor"? Always makes me think "hold the nor-gate". #britishproblems


I had a worse phone years ago and it had OTG and the camera was great. Why 7 years later Huawei phones don't have OTG?


Trusting networking gear to not eavesdrop on data is quaint. Moving to a world of end to encryption should keep at least everyone besides the carrier / device manufacturers themselves out of your conversations and data transmissions. Then worse that could happen with a rogue vendor is a denial of service.


But if for instance your electricity grid or 911 calls rely on the service, a denial of service can be a pretty big deal.


The article mentions that WISPS will be impacted. Aren’t they all using Ubiqiti?


Huawei's equipment is almost too cheap to be able to ignore it. Here in Europe most telecommunication equipment (DSL, GPON, LTE radios, CPEs etc) installed in the past 5 years comes from Huawei and ZTE.

I don't know whether Huawei and ZTE carry Chinese state backdoors in them, but if China had a plan to widely distribute equipment around the globe to be able to tap into any connection, it would have already succeeded.


Here in New Zealand, two of our major mobile carriers use Huawei gear. One uses Huawei for the entire mobile network (from UMTS/LTE base stations to the core network) while another is migrating from Alactel-Lucent (which mostly powers their legacy 3G gear and I suspect their core network still) to Huawei (their entire 4G network as well as 3G at some of the new base station sites). The latter carrier apparently pitted Alactel-Lucent and Huawei 4G gear at a difficult rural test site to decide whether they'd go with AL (whose UMTS/3G gear had been fairly unreliable) or try their luck with Huawei. I presume Huawei must have beat out Alactel-Lucent to win the contract to deploy 4G—a decision that has proved to be successful so far. One major landline telco uses Huawei gear. Many RSPs (ISPs) deploy Huawei DSL/Fibre CPE routers—with some getting good reviews for Gigabit Fibre (which many other branded routers struggle with). Many cheap phones sold by the various mobile carriers (either own-brand or Huawei brand) is Huawei.

While I can understand the distrust for Huawei, I can't deny they have done well when given the opportunity to do so. Alactel-Lucent (an US/EU company) in particular dropped the ball when one of our major telco had a major outage and it turned out they had a maintenance contract (so was AL themselves, not the telco responsible for maintenance of the network). Still took Alactel-Lucent's own experts a full week to restore telco services to a big chuck of our country. Severely dented our telcos' trust in US companies and thus encouraged the telcos to try Huawei instead. So far no major outages attributed to Huawai incompetence which has been a good plus so far.


Maybe consumers can ignore it, but governments won’t. Whether or not there are valid security threats, the US can use this to their benefit in the same way that China has used media control to their benefit.

I see a bifurcation if two non-comadible but competing political systems which will include different hardware, operating systems and applications. It will be interesting to see which system has the ultimate Darwinian advantage.


Good point. The Australian government banned Hauwei devices from being used in the large scale National Broadband Network.

https://www.smh.com.au/world/north-america/chinese-firm-huaw...


Meanwhile over the ditch in New Zealand we have no such restriction. I'm not sure if our equivalent to the NBN (the Ultra Fast Broadband [UFB] network) has much Huawei gear but I suspect there will be at least some depending on the LFC (Local Fibre Company). At the least many RSP (ISP) supplied CPE gear is Huawei and their gear at POPs is likely to be Huawei as well. Our wireless NBN equivalent (the Rural Broadband Initiative [RBI]) has one major telco using Huawei for 4G base station gear. I would hazard a guess that at least a third (if not more than half) of all traffic in New Zealand passes over at least one Huawei gear.


I read it as small telecoms. Not WISPs (Wireless Internet Service Providers). So companies which provide cell phone service. I don't think Ubiquiti is in the cell phone service market.


Some of the WISPs I've worked with (I've worked with quite a few) use Ubiquiti (or similar) wireless equipment with Huawei switches.


The WISP in my area is all Ubiquiti.


What's the deal with ubiqiti? Do they use Huawai parts or what?

I had understood them to be a fairly competent company delivering good products.


Have they considered a name change for the US market?


My Huawei is branded "Honor" (sic) in UK.




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