What is….Huawei?

What the heck is all this news about the Chinese tech company, Huawei? We hear about this company all over the news, and none of the information seems positive. Let’s take a look at this story and figure out what’s up.

WHO/WHAT IS HUAWEI?

Huawei Technologies Company, Limited, began in 1987 in southern China in a city called Shenzhen. According to sucessstory.com, “Huawei is the largest telecommunications equipment manufacturer in the world.” (They make good phones for cheap) Time Magazine reports, “Apart from cutting-edge smartphones, Huawei stands at the vanguard of 5G—revolutionary technology that will fuel the driverless cars and smart factories of the fourth Industrial Revolution.”

Huawei began as a private company, founded by Ren Zhengfei, an engineer and a former member of the Chinese Peoples’ Liberation Army (PLA). The PLA is under the absolute control of the Communist Party. Its commander is usually the Secretary General of the Chinese Communist Party. But Zhengfei’s time in the Chinese military has a couple of twists.

His parents were teachers but were not members of the Communist party. CNN reports, “During the Cultural Revolution, his father had been labeled a ‘capitalist roader’— someone attempting to restore capitalism and overthrow socialism—making it hard for Ren to become a member of the ruling Communist Party.” (There’s a movie here, for sure)

Zhengfei worked for the PLA, but he never achieved a military rank because of his family background. He was let go from the PLA. In 1987, with a tiny bit of capital, about $5800, he founded Huawei. It was the right time for the right man in the right industry, Telecommunications. The Chinese economy was transforming to a more capitalist model, and the shabby telecommunications infrastructure was holding back progress.

Huawei became the “Little Tech Company that Could.” It’s the usual story of hard, hard work and personal sacrifice. (Zhengfei spent less than a month a year with his children.) Privately owned Huawei, unable to compete with the big three state-subsidized companies of that time, had to create its own technologies. Working on a nimble, less bureaucratic non-governmental platform, Huawei became the most successful technology company in China. Its products and technologies are used in over 170 countries where Huawei employs more than 180,000 workers. It has the second biggest market share of smart phones (Samsung is first). It is a major world supplier of electronic parts. Huawei has built more than 1500 telecommunications networks worldwide. And, Huawei wants to be the number one builder of the new 5G networks. This is not going to happen in the United States, you can be sure.

WHAT’S THE PROBLEM?

The big question: Is Huawei’s equipment secure? While it is true that Huawei products do go through extensive risk-mitigation testing for security flaws, CNN reports that future updates, patches and fixes create opportunities to compromise a system. Further, Huawei has already been indicted on violating the Iran sanctions, bank fraud, stealing corporate secrets, and even robot technologies from T-Mobile.

Androidauthority.com reports, “Under the Obama administration, a U.S. cyber-espionage law limited the importation and use of Chinese-made information technology products, specifically targeting Huawei….” Huawei strongly denies any collusion with the Chinese government, but the law in China requires companies to legally assist the government with intelligence gathering. So, it’s a problem to have Huawei building the new 5G networks which will be carrying private, sensitive, protected information. An unusually united Congress supports prohibiting American companies from selling anything to Huawei without government permission.

Google has already severed ties with Huawei, based on security concerns over privacy. Under new laws being developed in Europe and the United States, Google can be held liable for security breaches. Now, Huawei cannot use Google’s Android Operating System, nor any of its apps including G-mail.  

This “tech-blockade” is part of the protest over Chinese demands that American companies must hand over the keys to their technology in order to get part of the market share in China. But look out! Huawei can retaliate by building their own operating system and become a big Google competitor.

IN A NUTSHELL

Look at it this way. The U.S. has a population of 3.8 million people. China has a billion people. Then there is all of Southeast Asia; India has a billion people. There is Africa and South America. Huawei wants it all. That would be a lot of control over global communications.

Republicans and Democrats agree it is a problem that must be confronted. Japan, New Zealand, Australia, and the United States have banned the import of Huawei 5G technology into their countries over security concerns. But Europe seems to be buying in, much to the consternation of their allies. Having China in control of the world’s 5G networks is just not too comfortable a thought for many people.

So, that’s about Huawei (pronounced wa-way).

You know? If I were a kid today thinking of doing a year abroad, I would not go to Europe. I would go to Singapore and start networking my way into the huge markets Huawei is after.

Vamos a ver!