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Huawei Denied German Bid

Ray Le Maistre
5/10/2012
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10:45 AM -- The list of countries where Huawei Technologies Co. Ltd. has been denied the chance to compete for business has grown again, with Germany the latest market to give the vendor further cause for concern.

Having already experienced the political cold shoulder in Australia, India and the U.S., Huawei has now been excluded from bidding for business at a major German research network where it was an incumbent supplier. (See Huawei Ban Row Escalates, US Blocks Huawei LTE Bid , Global Vendors Face Tough New Rules in India and More Security Woes for Huawei.)

Deutsches Forschungsnetz (DFN), Germany's national research and education network that stretches about 10,000 kilometers to connect about 60 sites, is to upgrade its network from 10 Gbit/s to 100 Gbit/s using technology only from European suppliers, according to Wirtschafts Woche and several other German media outlets.

Alcatel-Lucent (NYSE: ALU), Nokia Networks and T-Systems International GmbH have been shortlisted for the upgrade.

Chinese vendors are not being considered, it seems, because of security concerns, even though the current DFN network has been using Huawei equipment since 2005.

Lewis Xu, the CEO of Huawei Germany, expressed incredulity at the decision in a statement issued to the German press, saying that to exclude Huawei from the process is incomprehensible.

What must be more worrying for Huawei is that concern about cyber security is increasing and that many companies and national agencies point the finger at China as a prime source of political and industrial espionage attacks. (See Nortel Got Super-Hacked and this Bloomberg report, for example.)

It's hard to imagine that Huawei and other Chinese vendors, no matter how many existing national deployments and words of support they have, are going to find anything other than increasing resistance and further restrictions when it comes to their involvement in the construction of important national networks in the near term.

— Ray Le Maistre, International Managing Editor, Light Reading

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digits
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digits,
User Rank: Light Beer
12/5/2012 | 5:33:30 PM
re: Huawei Denied German Bid


Looks like Huawei's biggest challenge now is not in the R&D labs but in the marketing and communications departments...

geekhole
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geekhole,
User Rank: Light Beer
12/5/2012 | 5:33:30 PM
re: Huawei Denied German Bid


Security concerns aside, until Huawei goes public and pays dividends, benefiting global shareholders, mutual funds, 401ks. retirement accounts, etc. they willl continue to get the cold sholder. They need to spread the wealth or the wealth will stay with those that do!

Flook
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Flook,
User Rank: Light Beer
12/5/2012 | 5:33:27 PM
re: Huawei Denied German Bid


Weird that the Germans have deployed Huawei's equipment and are now shutting the door on Huawei. Regarding security, don't domestic networks often connect to national and international networks? In which case traffic from an NSN network for a particular customer could very well be going across a network built with Huawei gear--and there goes security out the door...


 


It's a global, interconnected world, so risks will be involved.

Ktan8888
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Ktan8888,
User Rank: Light Beer
12/5/2012 | 5:33:25 PM
re: Huawei Denied German Bid


Obviously this is the protectionism in play..


 


 

Soupafly
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Soupafly,
User Rank: Light Sabre
12/5/2012 | 5:33:24 PM
re: Huawei Denied German Bid


Branding it protectionism is just lazy.


The article provides no depth beyond obvious soundbites & trivial analysis.


To comment, you usually need to have a reasonable understanding. Based on the syndicated german content you have provided links to in the article, how anyone can arrive at any kind of understanding is beyond me!?


The fact that this network already used Huawei gear is what makes this unusual. The layer at which this exclusion has been imposed is also intriguing. The network deployment referenced would appear to be Layer 1 optical equipment in bias & focus.


What new "security concerns" have been identified?


Was it:


a) They found a "bird on the wire"?


b) Have seen a specific APT attack vector exploited or launched & traced the source?


c) Discovered a point of "Intellectual Property" compromise, directly connected to the network? (The most likely.)


d) Examined the layer 2 & 3 functionality/features on these platforms & decided that these represent a new risk that was not present in the original equipment? (An important trend in Packet Optical & pure optical is the convergence of traditional multi-layer functionality.)


e) None of the above & a new completely "concern"?


In the security community at the moment, the level of expertise & prowess been consistently demonstrated  by chinese hackers is worrying and has raised alarm bells. The speed & capability escalation has caught many by suprise. In 2005, the level of assessed risk & maturity was considered acceptable.


In 2012, that risk assessment barometer reading & the comfort zone around it, may have shifted. 


Couple that trend and its rapid acceleration with a strength in depth around science & mathematics (at the academic level) and you can see how original decision taken in 2005 may come under additional scrutiny and be re-evaluated.


The continued nonsensical statements from the party that "we are victims & know nothing of these attacks" is incredulous & laughed at by many within the community.


And before anyone crys prove it! Consider, the fact that the chinese networks are THE most overtly policed & monitored networks on earth, with inline & offline DPI, routine traffic mirroring, no privacy frameworks and complete compliance and oversight assumed by default. Then move that datapoint across all key intra-regional & national nodes and global IP Transit ingress/egress points & inter-connect and look at the ongoing, detailed traffic analytics.


Now I know the above statements are true because of actual conversations in this community. This is not spun, rumour-mill.


So with all of the above... what would you do if you were charged with making the call today? I am not taking a moral or ethical stand on this, just a pragmatic one and if I were in their shoes, I might make the same call. Note; Use of the word "might" not would. I dont have all the facts, just an insight into what they might be seeing.


 

macster
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macster,
User Rank: Light Bulb
12/5/2012 | 5:33:24 PM
re: Huawei Denied German Bid


Ray,


As the article itself says, they've been using Huawei since 2005, but now a change of tone?


Marcomms? Come on! This is so obviously European bigotry and hypocrisy in play - no more, no less.

digits
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digits,
User Rank: Light Beer
12/5/2012 | 5:33:23 PM
re: Huawei Denied German Bid


SO what I am saying is that it's not a technology challenge -- Huawei's marketing and communications team have to figure out how best to overcome the (choose your favorite term) political/protectionist/bigoted/xenophobic challenges the company now faces.


And not marcomms directed solely (or even primarily) at the direct customers but at the broader political and industrial landscape.

digits
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digits,
User Rank: Light Beer
12/5/2012 | 5:33:22 PM
re: Huawei Denied German Bid


T-Systems is not an equipment vendor, but is an integrator, so it would be taking third party equipment into this if it is successful. (I would put mt bet on T-Systems or NSN winning this deal...)


I suspect that there is an lement of outsourced network management in this, where the winner(s) would not only provide the equipment but be involved in the rollout and maybe even ongoing management of the network. That's something that ALU, NSN and T-Systems could do, though, of course, Huawei could do that too. 

cross
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cross,
User Rank: Light Beer
12/5/2012 | 5:33:22 PM
re: Huawei Denied German Bid


Ray, is it correct that T-Systems International is bidding for DFN's new network?  T-Systems is a subsidiary of Deutsche Telekom and not a vendor.  Traditionally, T-Systems often offers Cisco-based solutions.  It is a question whether Cisco qualifies more as a European vendor than Huawei does.  Both vendors have offices, R&D centers etc. in Europe but are headquartered outside Europe.


Carsten

macster
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macster,
User Rank: Light Bulb
12/5/2012 | 5:33:21 PM
re: Huawei Denied German Bid


Soupafly,


Having worked for Huawei, European vendors and operators, the consulting arm of DT, I do know what I am talking about (and definitely do not need a long comment to justify).


Like Phil says, this is not a technology issue. Not even marcomms!


What would you say if China bans Cisco, ALU, E\\\, citing 'security concerns'? You'll think of it as a joke, right? Yup, Huawei is a terrible and corrupted company. ALU, Siemens and others are righteous. Asian nations are corrupted. No corruption in EU/UK/US, merely Cash for Honours, Cash for PM Access, etc. Right?


Have the decency to call it what it really is. I know, I know..... the truth hurts!!!

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