Will Trump Make a Deal With Huawei?
One intriguing possibility offered by the Trump administration lifeline deal for ZTE Thursday is whether it could float a similar deal for bigger Chinese vendor Huawei in the US.
Recall that Huawei Technologies Co. Ltd is also under investigation in the US for alledgely busting American sanctions by selling networking gear to Iran and North Korea. That's the exact same thing that ZTE got a seven-year domestic component sales ban for in April, forcing the company to shut up shop in May. (See US Govt. Bans Domestic Component Sales to ZTE and ZTE Ceases Business Operations After US Ban.)
Huawei has reportedly been under investigation since at least late April. (See US Investigating Huawei for Sanctions Violations – Report and Huawei, ZTE in the Eye of a Trade Storm.)
The Trump administration has just basically confirmed President Trump's deal for ZTE: The Chinese firm will pay an additional $1 billion in fines, and let a US-picked "compliance team" examine its top management team. (See ZTE Fined Another $1B in Rescue Deal With US.)
If Huawei got a similar components ban after the US sanctions investigation, Trump and team would surely hear from the Chinese government tout suite. Huawei is the third-largest smartphone vendor in the world, after Apple Inc. (Nasdaq: AAPL) and Samsung Corp. , much larger than ZTE. Ripples from any components ban would be swiftly felt across the tech world.
Of course, a $1 billion fine would merely be a slap on the wrists for Huawei. It generated sales of nearly $93 billion in 2017. (see Huawei Hits $92B in 2017 Sales.)
Meanwhile, don't forget that many bi-partisan senators are still hopping mad over Trump's ZTE moves. As Senator Marco Rubio tweeted on Thursday:
This “deal” with #ZTE may keep them from selling to Iran and North Korea. That’s good. But it will do nothing to keep us safe from corporate & national security espionage. That is dangerous. Now Congress will need to act to keep America safe from #China— Marco Rubio (@marcorubio) June 7, 2018
So it seems likely there's plenty more to come in the US-China tech stand-off. (See Congress Examines Google OS Deal With Huawei.)
— Dan Jones, Mobile Editor, Light Reading