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Could Japan Also Bar Huawei, ZTE?

Ray Le Maistre

Hot on the heels of the Australian ban on Chinese 5G network gear that will impact the sales forecasts of Huawei Technologies Co. Ltd and ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) comes a report that suggests Japan could follow suit. (See Australia Excludes Huawei, ZTE From 5G Rollouts.)

According to this GB Times story, business newspaper Sankei Shimbun reported Sunday that the Japanese government was considering a ban on Chinese network technology being deployed in government systems for security reasons and that such a ban would provide guidance to the private sector, a move that would roughly align it with the US and Australia. (See US Government Agencies Barred From Buying Huawei, ZTE Tech.)

The Sankei Shimbun report cited an unidentified government official, but also pointed out how any such move would negatively affect the improving relations between Japan and China.

The Australian ban came after months of disquiet and concerns that the deployment of next-generation comms network gear supplied by Huawei or ZTE would compromise security. But this is the first time I have heard of any such concerns out of Japan, which has been a strong market for Huawei in particular. (See Huawei Faces Security Backlash in Australia.)

There have been no official announcements about any such considerations by the Japanese government: The report smacks of FUD rather than a genuine development. Right now, though, the Chinese vendors are ripe for such tactics following developments in the US, which, of course, is highly influential (for better or worse). (See Trump Admin Reboots $50B China Tech Tariffs.)

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Such reports will no doubt cause concern and anxiety in Shenzhen, where both Huawei and ZTE are headquartered. They will equally be leapt upon by the teams operating out of Stockholm, Espoo and Seoul (Samsung), especially considering that Samsung has now overtaken ZTE (still recovering from its US components supply freeze) as the world's #4 supplier of mobile network infrastructure, according to calculations by market research firm Dell'Oro Group .

Huawei, it's worth noting, still ranks as the world's leading supplier of mobile network infrastructure ahead of Ericsson AB (Nasdaq: ERIC) and Nokia Corp. (NYSE: NOK) and is the largest single supplier of communications networking technology (mobile, fixed, cable) globally.

The questions all those players (and others) will now be asking is -- where will security doubts about Chinese gear surface next? And when might retaliation from China hit the prospects of overseas vendors?

— Ray Le Maistre, Editor-in-Chief, Light Reading

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User Rank: Light Beer
9/2/2018 | 9:35:20 PM
where is the consumer's benefit?
Very ridiculous policy.

Why these countries don't have their own diplomacy, all following the U.S whic want to slave all the world for anther 100 years.
Joe Stanganelli
Joe Stanganelli,
User Rank: Light Sabre
8/29/2018 | 11:21:22 PM
A Japanese ban on these major Chinese manufacturers would certainly add pressure from US allies on the Chinese government. Could be nothing but unvarnished speculation, but it's not unreasonable to be on the lookout for this.
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