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Will China React to Latest US Huawei, ZTE Slapdown?

Ray Le Maistre
2/16/2018
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The US market just got even tougher for Huawei and ZTE, the two major telecom vendors that have come under the US national security spotlight for the past five years or so, as their mobile devices have now been labelled a security risk. (See AT&T Warned to Cut Ties With Huawei – Report, Huawei, ZTE Face US Federal Ban and Huawei Still Knocking on US Door – but AT&T Deal Thwarted.)

Multiple reports, including this one from CNN, noted that FBI, CIA, National Security Agency (NSA) and DIA (Defense Intelligence Agency) all sowed seeds of doubt about whether Chinese smartphones can be used to spy on the US.

It's hard to imagine that this is going to end well for anyone…

With the news breaking just as China embarked on the mass internal migration that marks the annual Chinese New Year celebrations, any immediate response was unlikely.

But in the Chinese Year of the Dog, will US companies find that the latest accusations leveled at Huawei and ZTE result in a post-holiday bite at their heels? US tech companies with business in China -- Apple, which generates tens of billions of dollars in revenues each year in China, and Cisco spring to mind -- might be feeling rather nervous as they head into the long US Presidents' Day weekend.

So will there be any reprisals? And what kind of impact will these pronouncements have on the US smartphone sales of Huawei Technologies Co. Ltd and ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763)? Those are two open questions. But here's another: Where is the evidence that the mobile devices from any companies are a security threat to the US?

That's the question that really needs to be answered if unwelcome trade conflicts are to be avoided.

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

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tojofay
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tojofay,
User Rank: Light Sabre
2/19/2018 | 3:33:07 PM
Re: full disclosure please
Yes, I'm suggesting that. Evidence should be presented. It exists, you should present it. Unless of course presenting it might jeopardize a relationship. Is China an open market for US companies? 

Does Lightreading receive monies from Huawei or not? Disclose, please.
ttthorn
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ttthorn,
User Rank: Light Beer
2/17/2018 | 7:37:57 AM
China and video surveillance
How do the likes of HIKvision or other Chinese vendors in the security space go without notice? Are they next? Does country or origin matter in video surveillance market or just at Tier 1 level?
Ray@LR
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[email protected],
User Rank: Blogger
2/16/2018 | 2:02:20 PM
Re: Pointless
Great analysis Patrick!
Ray@LR
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[email protected],
User Rank: Blogger
2/16/2018 | 2:00:30 PM
Re: full disclosure please
In response to tojofay:

erm.... are you suggesting that the angle of the article is driven by a commercial relationship? 

If so, I can think only that it is the sign-off, where I suggest that evidence to back up very serious allegations, should be presented. Is that a shocking suggestion? Does requesting that evidence be forthcoming constitute an act of financial bias?

Please...

 

 
HardenStance
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HardenStance,
User Rank: Lightning
2/16/2018 | 1:04:25 PM
Pointless
From a cyber security perspective, this guidance strikes me as pointless. 

Leave aside that the point of device manufacture is only one of several different ways to on-board malware onto a device.

The people who are at most risk  – and present the greatest risk to the wider public - from having their devices hacked for sensitive information are high net worth individuals (in business, social or political capital) most of whom wouldn't want a Huawei or ZTE phone anyway.

A subset of these – the really high end – are already using devices with elaborate data encryption and other advanced security controls within the device.

For most other high net worth individuals  – most of whom use iPhones – the implicit advice of the spooks is to be happy with an iPhone to which they themselves want a backdoor.

They want this even though recent history makes it clear that the keys to the kingdom will more than likely leak like a sieve and open the floodgates to all kinds of unsavoury sorts  - Chinese or otherwise – hacking into the world's iPhones at will.

Politicians and law enforcement want quick fixes because they enable them to achieve near term "being tough and being seen to be tough" targets.

Security starts with truly recognizing your own vulnerabilities.  This guidance of these  agencies suggests they don't actually recognize their own vulnerabilities. Or (much more  likely) they can't be seen to recognize them.

Net result ? The man or woman in the street is truly none the wiser.

 
tojofay
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tojofay,
User Rank: Light Sabre
2/16/2018 | 1:01:52 PM
full disclosure please
Huawei contract with Lightreading? Come clean dudes.
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