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Face-Saving in Seoul Over Huawei Role

Robert Clark
News Analysis
Robert Clark
2/17/2014
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The US and South Korean governments have reached agreement over how to deal with Huawei's role as a network kit supplier.

The two countries have been negotiating over the use of Huawei equipment in South Korea since US lawmakers raised security concerns late last year, and now the two countries appear to have found common ground. (See US Senators Stir Up Huawei Security Concerns.)

But it's just not clear what that deal is. According to a Wall Street Journal report, the South Korean government has agreed that sensitive US and Korean data won't pass through Huawei equipment.

Yet analysts point out that it is standard practice to run military comms on separate networks.

Additionally, LG U+ , whose 4G contract is at the heart of Washington concerns, is the smallest Korean mobile operator and unlikely to be carrying any significant amount of even non-sensitive government traffic.

Huawei has supplied gear to the two other operators, KT Corp. and SK Telecom (Nasdaq: SKM), but this is its first major Korean contract. SK Telecom, which deploys some Huawei transmission gear, says it is "not using Huawei equipment for sensitive parts of its network."

The US has 28,000 troops in South Korea across multiple bases.

A Huawei spokesperson says the company will "build the LTE network that we have been contracted to build."

But as well as sensitive data, the sensitivities of the Korean and Chinese authorities are also in play here. South Korea doesn't want to appear to be dictated to by the US, and certainly doesn't want to offend its large neighbor.

In the end, the deal appears to be more of a symbolic one that keeps most parties happy.

The US has kept Huawei in check and sent a clear message to South Korea about future deals. Meanwhile, LG U+ keeps its network, Huawei keeps its customer, South Korea keeps its dignity, and Beijing keeps to the sidelines.

— Robert Clark, contributing editor, special to Light Reading

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R Clark
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R Clark,
User Rank: Blogger
2/18/2014 | 2:38:42 AM
Re: happening anywhere else too
The Australian govt has banned Huawei from bidding on its NBN. Huawei is still allowed to bid for LTE business there, although it's been effectively warned off 4G in Korea.
brookseven
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brookseven,
User Rank: Light Sabre
2/18/2014 | 12:17:46 AM
Re: happening anywhere else too
None of those countries have a nuclear armed neighbor that is allied with the PRC.

seven

 
eurichardson
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eurichardson,
User Rank: Light Bulb
2/17/2014 | 10:46:58 PM
Huawei hacking telecom networks
I think the US concerns about Huawei are well founded. Recently, Reuters reported that the Government of India has launched an investigation about Huawei's hacking of one its telecom networks

http://www.reuters.com/article/2014/02/06/us-india-huawei-hacking-idUSBREA150QK20140206

 
nasimson
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nasimson,
User Rank: Light Sabre
2/17/2014 | 10:07:23 PM
Re: happening anywhere else too
Thanks Brookseven. That explains. With this reason, they will also be intervening in Saudi Arabia, Qatar, Bahrain, Japan, Afghanistan, Iraq and a dozen other countries. They should open a department 'Foreign Telecom Affairs'. :)
brookseven
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brookseven,
User Rank: Light Sabre
2/17/2014 | 11:38:49 AM
Re: happening anywhere else too
nasimson,

The US doesn't have significant numbers of troops in the countries you mentioned. 

seven

 
nasimson
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nasimson,
User Rank: Light Sabre
2/17/2014 | 9:55:28 AM
happening anywhere else too
Is South Korea the only country where US wants to intervene in Telecom deals? Is it due to the proximity to North Korea? Telenor group recently chose Huawei to have the IN networks in Pakistan, Thailand and Malaysia. I didn't come across of this intervention there.
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