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Huawei Still Striking Out With US Cable

Alan Breznick
3/31/2016

Despite a concerted effort to curry favor with US cable operators and CableLabs, Huawei has not managed to sign up any MSOs yet for its next-gen cable equipment, largely because of the federal government's continued security concerns about any telecom dealings with Chinese technology suppliers.

For the past several years, Huawei Technologies Co. Ltd. has been working hard to woo US cable operators to try out and adopt its broadband, video and wireless products. Huawei has also collaborated closely with CableLabs , the industry's research and development group, to develop and showcase such next-gen technologies as DOCSIS 3.1, Converged Cable Access Platform (CCAP), Distributed Access Architecture (DAA) and integrated DOCSIS/PON networks.

But even though cable operators may like Huawei's technology, and admire its persistence, the big Chinese equipment supplier still has precious little, if anything, to show for its aggressive push. Asked by Light Reading to name any US MSO customers, both current and former Huawei executives could not cite a single one.

That stands in stark contrast with Huawei's stature in the rest of the world, where the vendor has scored numerous successes with cable operators. In New Zealand, for example, Huawei recently carried out the world's first deployment of DOCSIS 3.1 cable modems and network equipment with Vodafone New Zealand , as the two companies spelled out in a Light Reading webinar last November.

The fault is not really Huawei's, though. In a number of cases, industry sources say, major and midsized cable operators have begun testing Huawei technology platforms, or even operating their systems commercially, only to encounter stiff warnings from the US government that they will lose all federal business unless they stop doing so.

In fact, at least two leading US MSOs -- Comcast Corp. (Nasdaq: CMCSA, CMCSK) and Cox Communications Inc. -- and another midsized one, Bend Broadband, have tried out Huawei's wireless network equipment in their fledgling mobile networks and, according to industry sources, come away satisfied with the results. But all three operators abruptly shut down those field trials after being warned by US government officials they would not receive any federal telecom contracts, and lose the ones they had, if they stuck with Huawei, the sources said.

Anxious about incurring Washington's wrath, Comcast and Cox executives declined to speak either publicly or privately about their experiences with Huawei and the US government. But both MSOs have acknowledged they tried out Huawei's wireless equipment and then scrapped those efforts before going live with the networks.

"Years ago we were building our own wireless network and they were a vendor for that," a Cox spokesperson said. But, the spokesperson quickly added, "we never turned it on, no products sold, no customer traffic ran across it. We went with a MVNO wireless service instead and we eventually decommissioned that too."


For more fixed broadband market coverage and insights, check out our dedicated broadband content channel here on Light Reading.


Huawei executives bristle about the security concerns issue, which grew out of an October 2012 report from the US House Permanent Select Committee on Intelligence that cited Huawei and fellow major Chinese equipment vendor ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) as security risks. They hotly dispute the findings of the report, which recommended that federal contractors exclude technologies from the two companies and "strongly encouraged" network providers and system developers to "seek other vendors for their projects," among other things. (See US vs Huawei/ZTE: The Verdict.)

"The accusations are groundless. To date, not a single individual or organization that has questioned our integrity has ever provided any evidence to substantiate their allegations," said a Huawei spokesperson. "We believe all governments, industry stakeholders and customers should work together in an open and transparent manner to jointly address global cyber security challenges and raise cyber security standards in order to ensure that network technology benefits consumers."

Stymied in its efforts to sign up large and midsized cable operators, Huawei is now focusing more on smaller, more rural providers, especially smaller telcos in Tier 2 and Tier 3 markets that have lately become "hybrid operators" by gobbling up rival cable systems in their regions. One prime example is Eastern Oregon Telecom (EOT), the one cable-related success story that Huawei can cite in the US so far. Based in Hermision, Ore., EOT serves a little more than 8,000 homes and businesses in eight small communities in the eastern part of the state.

Going where no other US cable operator has gone before, EOT started deploying Huawei's Distributed Cable Modem Termination System (D-CMTS), which leverages both DOCSIS and GPON technologies, in its footprint last year. It is now converting the rest of its HFC network to the Huawei platform, phasing out older equipment from Cisco Systems Inc. (Nasdaq: CSCO).

"My team has really put the Huawei D-CMTS through its paces and has not found any concerns either technically or in regards to security," EOT CEO & GM Joseph Farrell told Light Reading. "In fact, and as has been the case with the core network and GPON equipment we have received from Huawei, we couldn't be more pleased."

Despite their frustrating experiences in the US, Huawei executives insist that they will continue to pound the pavement in the world's most lucrative cable market. "We will not give up on the US market," the Huawei spokesperson said. "As long as our customers need us, we will always provide them with the best products and services. We will continue to provide competitive solutions that meet customer needs in the US market. If all but one country have access to Huawei's high-quality products and services, it is unfair to consumers in that particular country."

— Alan Breznick, Cable/Video Practice Leader, Light Reading

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JackZhuhong
JackZhuhong
4/21/2016 | 8:57:27 PM
Peace world
China open to Google & Facebook etc., US open to Huawei & other Chinese vendors. That's the dream for the peace world. I'm not sure we'll see this in 10 years.
mendyk
mendyk
4/7/2016 | 10:18:02 AM
Re: He never puts the seat down
The pressure is generic -- as in, if you have Huawei in your network, you are barred from bidding on any federal government projects. The motivations are more political and economic than technological.
danielcawrey
danielcawrey
4/3/2016 | 4:33:18 PM
Re: He never puts the seat down
I did not realize the amount of pressure the US government is putting on operators not to use Huawei. I'm not privy to the details, but it would seem to me the government has found some serious vulnerabilities in Huawei's hardware/software in order to put so much pressure out there. 
mendyk
mendyk
3/31/2016 | 5:05:05 PM
He never puts the seat down
Trade battles are like marital squabbles -- the "cause" usually is something other than the focus of the complaint. In this case, the lack of a two-way open market and some protectionist lobbying are likely to be at the source of the freeze-out.
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