The Trump administration has issued orders that effectively ban American companies from providing components and software to Chinese companies, including Huawei. In turn, the Chinese government has threatened to disrupt global supply chains with disruptions to manufacturing and assembly that’s essential to U.S. tech companies.
The issue with Huawei is a startling example of the scope and scale of technology threats every company faces today.
What Is Huawei?
Huawei Technologies is the world’s largest telecom supplier and second in smartphone production. It provides an array of technology products including telecom services and networks, devices and enterprise software, equipment and services. Its products are found widely in the networks used to connect devices to data centers and other components.
The company employs 188,000 people worldwide and operates in 170 countries.
As countries and private companies look to move to 5G wireless networking, the company has come under increased scrutiny. Despite those security warnings, the United Kingdom selected Huawei, which is far more advanced than its competitors with regards to the core components, to build its 5G network.
What Are the Security Concerns With Huawei?
The United States, European Union companies and NATO members have all expressed concerns with Huawei and other Chinese companies regarding security. In January 2019, the Justice Department accused Huawei of theft of intellectual property, obstruction of justice and fraud in a 243-count indictment. The U.S. government had previously banned the company in 2012 from selling networking equipment.
The security concerns include a fear that the company will use its equipment to spy on others and share stolen information with the Chinese government.
The issue, however, is not as cut and dried as both sides make it appear.
U.S. officials point to incidents including the discovery of hidden backdoor in Vodaphone equipment, revelations by the CIA that the company is funded by the Chinese state security apparatus, a raid on a Huawei lab and the arrest of a Huawei employee in Poland for spying. All those events occurred in the first 6 months of 2019.
Conversely, Huawei has called for international cybersecurity standards, is developing its own operating system if Android and Windows products are fully disallowed, and announced it will overtake Samsung as the world’s top smartphone maker by 2020. and signed agreements to develop 5G networks in Russia.
What Action Has the U.S. Government Taken?
The May executive order restricts U.S. companies from buying any telecom equipment deemed to be a security risk. The Commerce Secretary is authorized to determine which transactions carry potential risk.
Managing risk is critical for governments and private companies alike. At Alvarez Technology Group, we help companies assess security measures and deploy solutions designed to keep devices, systems and users protected. To learn more, schedule a free, no-obligation consultation today.
