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Huawei's Rollercoaster Week

Ray Le Maistre

If there's another company in the communications sector that can match Huawei for an almost never-ending stream of eye-grabbing headlines, then please point it out.

The Chinese vendor giant has long been at home to controversy, while at the same time impressing many people (including, in private, many rivals) with its R&D capabilities and relentless global push.

Usually, the headlines are mostly about advances and developments, peppered with the occasional knock-back, such as the company's travails in the US market, where it is effectively outlawed from the major telco networks.

During the past week, though, the Huawei Technologies Co. Ltd. PR team has been fighting fires on multiple fronts. First, T-Mobile US Inc. accused it of industrial espionage, which, to be honest, is not a massive eyebrow-raiser, given the number of IPR lawsuits there are in this industry: Everyone's suing someone, somewhere, especially when it comes to smartphone-related patents. (See T-Mobile Accuses Huawei of Espionage.)

But then it was revealed in the Chinese press that more than 100 of the vendor's staff have been implicated in bribery allegations that also involve various sales agents. The details were revealed at a company meeting and Huawei has since confirmed internal probes to uncover corruption amongst its very large workforce are standard practice, and that this is nothing unusual.

Huawei's problem, as we have pointed out before, is that the company has a history of errant staff and industrial malpractice, so such incidents stick out more than they might for others. Of course, we have also pointed out that Huawei is not alone in employing staff that succumb to temptation. (See Can Huawei Change?)

In my view, Huawei has matured a great deal as a company in the past five years, but it still needs to go a little further, perhaps, in stamping out any business practices, at home and abroad, that might tarnish its name as it attempts to become an even greater power in the telecom, enterprise and smartphone markets.

And, of course, it's not all bad news. Huawei also this week announced that it has engaged with 21Vianet Group, China's largest carrier-neutral Internet Data Center (IDC) services provider, to launch what the vendor calls "China's largest commercial Software-Defined Networking-enabled (SDN) network." The network will, adds Huawei, "provide flexibility to subscriber networks that manage and support cloud services. It will enable enterprises to adjust their business strategies to stay competitive in a dynamic market environment."

Huawei needs more of this type of news, and less of the other…

— Ray Le Maistre, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, Editor-in-Chief, Light Reading

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9/12/2014 | 10:28:07 AM
Re: A positive
I trust he didn't mention eggs or omelets at all.
9/12/2014 | 10:28:03 AM
This reminds me of my favourite scene from Casablanca
Captain Renault: I'm shocked, shocked to find that gambling is going on in here!
[a croupier hands Renault a pile of money]
Croupier: Your winnings, sir.
Captain Renault: [sotto voce] Oh, thank you very much.

Captain Renault: Everybody out at once
R Clark
R Clark
9/11/2014 | 7:19:05 PM
A positive
Ren Zhengfei's explanation was that 100 cases of corruption was not a lot for a company of 150,000.  In Chinese terms, that's a good result! Plus this episode shows Huawei is more serious than others in dealing with it.
Mitch Wagner
Mitch Wagner
9/11/2014 | 7:05:58 PM
Re: Espionage
Indeed. In gangster movies, we call that "taking the fall."
9/11/2014 | 3:03:14 PM
Re: Espionage
In chess, sometimes it's better to sacrifice a couple of pawns to protect a knight, or the queen or king even
Mitch Wagner
Mitch Wagner
9/11/2014 | 2:28:31 PM
The espionage lawsuit was rendered less entertaining by Huawei's ready admission of guilt -- specificially that a couple of rogue employees did it. Given that, Huawei is likely to just settle the thing for buckets of money just to make it go away. Pity. 
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