A view shows a Huawei logo at Huawei Technologies France headquarters in Boulogne-Billancourt near Paris, France, February 17, 2021. REUTERS/Gonzalo Fuentes/File Photo
Vodafone's (VOD.L) Italian unit has secured conditional approval from Rome to use equipment made by China's Huawei in its 5G radio access network, two sources close to the matter said.
Italy can block or impose tough conditions on deals involving non EU vendors under "golden powers", which have been used three times since 2012 to block foreign interest in industries deemed to be of strategic importance.
The government of national unity led by Prime Minister Mario Draghi authorised the deal between Vodafone and Huawei (HWT.UL) on May 20, one of the two sources told Reuters, asking not to be named because of the sensitivity of the matter.
As in similar deals, the government imposed a set of prescriptions including restrictions on remote intervention by Huawei to fix technical glitches and an extremely high security threshold, the source added.
Vodafone and Huawei declined to comment.
The United States has lobbied Italy and other European allies to avoid using Huawei equipment in their next generation telecoms networks and to closely scrutinize rival ZTE, saying the companies could pose a security risk.
Huawei and ZTE strongly deny the allegations.
In the last 12 months, Italy has adopted a tougher stance on Huawei, while not banning it entirely from 5G infrastructure.
Under previous Prime Minister Giuseppe Conte, Rome prevented telecoms group Fastweb in October from signing a deal with Huawei to supply equipment for its 5G core network, where highly sensitive data is processed.
Small toy figures are seen in front of a displayed Huawei and 5G network logo in this illustration picture, March 30, 2019. REUTERS/Dado Ruvic/Illustration
An espionage trial involving a former Polish secret services agent and an ex-employee of Huawei begins in a Warsaw court on Tuesday as some European states consider whether to exclude the Chinese group's equipment from their 5G telecom networks.
Poland arrested the two men in January 2019 on suspicion of spying for China, in a move that has ramped up international debate over the potential security risks of using Huawei equipment in communications networks.
Huawei has repeatedly denied its equipment can be used for espionage by authorities in Beijing, but the United States has been pressuring countries to ban it. In Europe, only Britain and Sweden have so far done so.
Polish prosecutors allege that Wang Weijing, 39, using the cover of being a Huawei executive, spent more than seven years spying for China trying to bolster the company's ability to influence the Polish government and "enable it to... manage the state... technology infrastructure", court documents show.
Wang, who has been in detention since his arrest, is also charged with recruiting a former Polish secret service agent who, prosecutors say, informed him about ways of influencing the country's rescue and public safety services radio networks.
The Polish defendant, Piotr D. had worked for years in the top echelons of government, and is accused of "offering himself as a source of information" regarding public administration.
Both men deny any wrongdoing.
Prosecutors say that the cybersecurity specialist, who has asked that his last name be withheld under privacy rules, informed Wang of a monitoring system to guard against intruders accessing classified information sent through fibre optic communication networks created by Warsaw military university.
Wang's lawyer, Bartlomiej Jankowski, said prosecutors had no proof of any spying activity by his client.
"There is no evidence of anything illegal," he told Reuters.
Huawei, which fired Wang after his arrest but has helped finance his legal fees, told Reuters in a statement last month that its activities are "in accordance with the highest standards of transparency and adherence to laws and regulation."
U.S. RELATIONS
The administration of then U.S. President Donald Trump had praised Poland for the arrests, with former vice-president Mike Pence saying in 2019 that they demonstrated Warsaw's commitment to ensuring the telecommunications sector was "not compromised in a way that threatens our national security".
At the time, Warsaw was seeking to convince the United States to increase its military presence in Poland, alarmed by increased Russian assertiveness.
Prime Minister Mateusz Morawiecki's government proposed draft legislation last year that could lead to a de facto exclusion of Huawei from building 5G networks, but the proposal has yet to be discussed by parliament.
European mobile operators have long been reluctant to start investing in 5G networks, which could support smart factories and self-driving cars, because of a lack of political clarity about whether they must accede to U.S. demands to exclude leading equipment supplier Huawei and other Chinese vendors.
Huawei said that its exclusion from 5G would mean an almost 44 billion zlotys ($12 billion) loss for the Polish economy and a delay of 5G rollout by a few years.
It has challenged Sweden's ban on its equipment in 5G networks, where a verdict is awaited from a local court.
Romania's government also approved a bill that effectively bars China and Huawei from taking part in the development of its 5G network in April, but it still needs parliament's upper house approval, considered to be a rubber-stamp. read more
June 2 might be a very busy day for Huawei, because we were already expecting to see both the Huawei Watch 3 and Huawei MatePad Pro 2 at a launch event on that date, and now it looks like the Huawei P50 range will be landing alongside them.
While this hasn’t been officially confirmed, it has been heavily hinted at in a teaser image shared by @UniverseIce (a reputable leaker) on Twitter.
The image follows the pattern of other teasers we’ve seen for the event, and along with the June 2 date it includes a side view of what looks to be the circular camera bumps that have been rumored for the Huawei P50.
It seems that Huawei P50 is coming soon pic.twitter.com/eALGjElNoSMay 28, 2021
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It’s not clear whether this image has been officially shared yet or whether @UniverseIce obtained it some other way, but it looks convincing, and the Huawei P50 is our best guess for what it teases. Plus, the leaker posted alongside the image that “it seems that Huawei P50 is coming soon.”
It’s worth noting however that beyond the date, all of these teasers just say “HarmonyOS” rather than including product names. We’re expecting the phone, tablet and smartwatch to all run Huawei’s HarmonyOS, but it’s possible that the focus will be on the software, with the devices themselves getting fully unveiled at a later date.
Still, at the very least we should get a first look at them on June 2, and hopefully this will be the full announcement, as the Huawei P50 in particular looks like an exciting device. Rumors point to it packing a massive 1-inch camera sensor, and suggest that it will be joined by an even more premium Huawei P50 Pro and P50 Pro Plus.
TechRadar will cover the June 2 event in full, so whatever ends up being announced you’ll find all the details here.
Huawei's HarmonyOS is right around the corner at this point, with an official unveiling event set for June 2. The Chinese giant has major plans for its Android alternative, with a goal to have it running on 300 million devices by the end of the year. Some part of that massive figure will surely come from brand new device sales. For one, Huawei has been posting teasers for the June 2 event with hints for the upcoming MatePad Pro 2, as well as the Huawei Watch 3 - both slated to be among the first to run HarmonyOS out of the box.
A large part of the effort will, however, be focused on updating existing devices from Android to HarmonyOS. A process that is expected to start fairly soon and one that will likely be kicked-off at the June 2 event. At least according to an industry source that claims to know the first batch of phones that are going to be migrating to HarmonyOS - an announcement probably coming at said event. Apparently these include: Mate 40, Mate 40 Pro, Mate 40 Pro+, Mate 40 RS, Mate X2, nova 8, nova 8 pro and MatePad Pro.
The source also notes that many devices in offline stores have already been updated to HarmonyOS and that hand-on experiences will be kicking-off shortly after the June 2 event. Also, apparently, this is just the first wave of devices to get a HarmonyOS update, with more on the way.
There are still plenty of question surrounding HarmonyOS. We only have bits and pieces, like a video , comparing the new OS side by side with Android and EMUI 11. The two seem quite similar visually and there have also been reports that HarmonyOS is quite close to Android under the hood. In any case, we’ll wait until we get our hands on a device with the new platform for any further comments.
[Shenzhen, China, May 29, 2021] Huawei's UNC, UDG, UPCF, and UDM passed the 5G Core (5GC) Security Assurance Specifications (SCAS) testing defined by 3GPP. The testing was performed by SGS Brightsight in the Netherlands. Furthermore, the test report has been released on the GSMA website (Link). After passing GSMA's security assessments of vendor development and product lifecycle processes (Link) and 3GPP's SCAS testing, Huawei 5GC has now become the first to pass the GSMA's complete NESAS evaluation.
As for the evaluation itself, NESAS is a standardized cybersecurity evaluation, which has been collectively outlined by GSMA and 3GPP, along with main international carriers, equipment vendors, industry companions, and regulators. The NESAS include security assessments of vendor development and product lifecycle processes and Security Assurance Specifications, it acts as a mobile industry-wide network security evaluation framework that is efficient and open to evolution. It objectively measures how secure a network product is. The NESAS offers the mobile industry threat analysis, definitions for critical assets, a methodology for security assurance, and general security assurance requirements. The unified design of the evaluation process avoids lopsided evaluation and conflicting security assurance requirements in different markets. In addition, it will always be open to feedback from different stakeholders, and will keep evolving with regular releases.
SGS Brightsight was founded in the Netherlands 35 years ago and is staffed with more than 100 experienced professionals. It is the world's largest cyber security evaluation lab, with evaluation results recognized worldwide. SGS Brightsight performed the security testing on Huawei's UNC, UDG, UPCF, and UDM, covering general security, service function security, transmission security, and O&M security. According to the report, all the tests mentioned were passed at 100%.
Belief in products should be primarily based on verifiable details which, should also be based primarily on shared standards. NESAS offers standardized security mechanisms applicable to the communications trade. It is acknowledged for its excellence and customization, for being environment friendly, for being unified, open and global, and also for its commitment to everlasting evolution. Huawei is as an active participant, and is dedicated to supporting GSMA and 3GPP in developing a globally standardized security evaluation. As such they urge others in the industry to undertake NESAS to promote their sustainable development as global network security standards.
Huawei has been using the invites for its HarmonyOS event to tease upcoming products – first the Huawei Watch 3, then a new M-Pencil for the upcoming MatePad Pro 2 tablet and now the Huawei P50 series. The latest invite shows two circular camera bumps seen at an angle.
We have seen these bumps several times before in leaked renders and hands-on photos. They are supposed to house an impressive Sony IMX800 1” sensor, however, the trade sanctions and the delays they brought have caused Huawei to lose some of its thunder.
For one, Sharp already announced a phone with a 1” sensor, beating Huawei to the punch. The camera on that phone was co-developed with Leica, by the way, Huawei’s long-term partner. A couple of days before the Aquos R6 was unveiled rumors swirled that Leica is looking for a new partner (the company said “no comment”).
Anyway, the date is the same on all three teasers – June 2. It’s not clear whether the Huawei P50 phones will just be used as a platform to show off HarmonyOS or if the company will finally launch its new flagships.
One result of the partnerships will launch June 2: a replacement for Google’s Android operating system for smartphones. Huawei’s HarmonyOS was built with help from the company’s Russia research teams, which encompass some 1,500 staffers in Moscow, St. Petersburg, Nizhny Novgorod, Novosibirsk and Minsk, Belarus, according to Russia’s state-run Sputnik News.
LOS ANGELES - A new report suggests that Chinese telecommunication firm Huawei has successfully secured contracts to provide cloud infrastructure in emerging economies in Asia, Africa and Latin America — a strategy that could allow Beijing to harvest important and sensitive information for "coercive leverage."
The move comes as many developed economies such as the United States, Australia, the United Kingdom and France are banning or restricting Huawei from their 5G networks.
The report, "Huawei's Global Cloud Strategy — Economic and Strategic Implications," published by the Center for Strategic and International Studies (CSIS), a Washington think tank, identified 70 deals in 41 countries between Huawei and foreign governments or state-owned enterprises for cloud infrastructure and e-government services, a bundling that can cut administrative costs. The contracts were executed from 2006 until April 2021.
Most of the deals share three characteristics, according to report authors Jonathan E. Hillman and Maesea McCalpin.
According to the report, these are:
Not free: 77 percent of the deals are located in countries that are considered either "not free" (34 percent) or "partly free" (43 percent) according to Freedom House ratings.
In Africa or Asia: 56 percent of the deals are with countries located in sub-Saharan Africa (36 percent) or Asia (20 percent).
Middle-income: 72 percent of the deals are in lower-middle-income (38 percent) and upper-middle-income (34 percent) countries.
In 60% of these deals, Huawei packages the delivery of hard infrastructure with services and offers favorable financing from the so-called policy banks — the Export-Import Bank of China (Chexim), the China Development Bank (CDB), and the Agricultural Development Bank of China (ADBC) — all established by the Chinese government in 1994 and each dedicated to a specific lending purpose.
FILE - Huawei's Director of the Board William Xu speaks at the opening of Huawei Global Analysts Summit in Shenzhen, Guangdong province, China, April 12, 2021.
The CSIS report warned that as Huawei carves out a niche as a provider to governments and state-owned enterprises, "its activities could provide Chinese authorities with intelligence and even coercive leverage."
In response to the report, Huawei issued a statement saying the company does not own or control any customer data.
"Network security and user privacy are our top priorities," the statement added.
However, part of the concern surrounding Huawei and other Chinese tech companies such as ZTE stems from the language in a Chinese law covering matters of national intelligence, as passed on June 27, 2017, by the 28th meeting of the Standing Committee of the 20th National People's Congress.
Article 7 states, "All organizations and citizens shall support, assist, and cooperate with national intelligence efforts in accordance with law, and shall protect national intelligence work secrets they are aware of.
"The State protects individuals and organizations that support, assist, and cooperate with national intelligence efforts."
VOA contacted Huawei for further comment, but did not receive a response.
VOA also emailed the Chinese Embassy in Washington and has not received a response about the report's suggestion of the potential for information sharing between Huawei and Beijing.
Smartphone slump
Once a global leader in smartphone sales, Huawei has seen its market share outside China plummet since the Trump administration restricted its supply of technology needed to produce modern 5G handsets. And the company's business installing mobile telecommunications infrastructure, especially new 5G-capable systems, has been severely damaged by a U.S. campaign against the company.
Huawei Running Out of Smartphone Chips under US Sanctions
Huawei is at the center of US-Chinese tension over technology and security, and the feud has spread to TikTok and WeChat
Huawei has made its cloud business a strategic priority to counter sanctions from developed countries that limit its access to mobile semiconductors.
Ken Hu, rotating chairman of Huawei, was quoted in March by the Japanese business news site, Nikkei Asia, saying that the COVID-19 pandemic had advanced the adoption of cloud services by global enterprises by one to three years, and that revenue generated by Huawei Cloud grew 168% year on year.
Jason Li, a research associate with the East Asia program at the Stimson Center, told VOA Mandarin by phone that it's in Huawei's interest both financially and strategically to move its focus to cloud infrastructure.
"It's obviously looking for new markets to offer its new products in order to stay afloat, and this comes at a time when Huawei is reconsidering exactly how it wants to market itself," he said.
Richard Weitz, a senior fellow at the Hudson Institute, agreed that Huawei is now trying to reposition itself in developing markets.
"We know nobody in the U.S. or Europe who most likely will buy Huawei cloud services because of security and other challenges," he told VOA Mandarin via phone. "But there are markets that are undeveloped — particularly in Africa but also Latin America, parts of Asia — and Huawei seems to be making some progress there with its cloud service offerings."
'Coercive leverage'
The CSIS report pointed out that "Huawei's cloud infrastructure runs the gamut from small, modular data centers the size of a shipping container to multilevel buildings packed with servers, and its e-government services include document digitization, national ID systems, tax services, crisis communications, elections and more."
And there are strategic implications.
"Huawei's cloud infrastructure and e-government services are handling sensitive data on citizens' health, taxes and legal records. These services also operate critical infrastructure, from oil production and fuel distribution in Brazil to power plant operations in Saudi Arabia," the report said.
FILE - Information on Huawei's 5G equipment is seen on a screen at the World 5G Exhibition in Beijing, China, Nov. 22, 2019.
Huawei landed on what's known as the entity list during the Trump administration over concerns it posed an espionage threat because of its ties to the Chinese government.
In March, the U.S. notified some Huawei suppliers that more items would be banned for export because of their use in 5G technology.
China has long objected to restrictions imposed or proposed by the U.S. On March 12, 2021, Foreign Ministry spokesman Zhao Lijian said, "The previous U.S. administration abused the concept of national security and left no stones unturned to suppress Chinese high-tech companies with state power. ...
"The U.S. side should stop its crackdown on Chinese companies, treat them in an open, fair, unbiased and non-discriminatory manner, and do more to enhance China-U.S. scientific and technological exchanges and economic and trade cooperation."
Weitz said Chinese authorities will benefit from Huawei's ability to collect data from other countries.
"This would allow them to access information that could provide what the Russians call 'compromising information' in bad or illicit activities — misbehavior that you don't want it to be released into the public. They could leverage that for gains," he told VOA Mandarin.
As Beijing develops its artificial intelligence capabilities, "having access to millions of additional sources of data can help them refine their computer and control models," Weitz said of Huawei's collecting.
In July, Senator Bob Menendez, ranking member of the Senate Foreign Relations Committee, published a report stating that China is developing "digital authoritarianism" to conduct surveillance, control the internet and censor information within its borders and around the world.
Cloud competition?
To compete with Chinese influence in these developing economies, the authors of the report recommend that "the U.S. and allied policymakers should prioritize cloud infrastructure and services as an area of strategic competition."
This would include "packaging cloud services with support for the infrastructure that underpins them, including not only data centers and fiber optic networks, but also energy infrastructure."
The authors also recommended that "the United States and its allies should pool resources to expand financing and funding for digital infrastructure, technical assistance and training. They should also cooperate to remove and prevent foreign regulatory barriers that disadvantage U.S. and allied cloud providers."
Herbert Lin, an expert in cyber policy and security at the Hoover Institution, said the U.S. must become a real competitor and provide developing countries an alternative to China's Huawei.
"The U.S. policy now is 'Just say no to Huawei.' But that's not a strategy. You have to be a competitor," he told VOA Mandarin via phone. "You have to have the technological competence to build a competing service, and you have to have a willingness to sell it aggressively at terms that another nation will find more favorable. … If the U.S. is going to play, we have to have a policy that will support our bid."
Sen. Marco Rubio, R-Fla., walks to the Senate subway after a vote in the U.S. Capitol on Wednesday, May 26, 2021.
Bill Clark | CQ-Roll Call, Inc. | Getty Images
Three Republican senators have jointly voiced opposition to a Biden administration nominee for legal counsel at the Office of the Director of National Intelligence because of his past work for Chinese tech giant Huawei.
The U.S. Director of National Intelligence is the head of the U.S. intelligence community and acts as the principal intelligence advisor to the president, the National Security Council, and the Homeland Security Council.
Fonzone served as legal adviser to the National Security Council during President Barack Obama's second term. He joined law firm Sidley Austin, which also does lobbying work, in November 2017, and did legal work for China's Ministry of Commerce and Huawei — though fewer than 50 billable hours for each, according to a questionnaire he filled out for the committee.
When Huawei was under U.S. regulatory scrutiny in 2019, at least three attorneys from Sidley Austin were registered to lobby on behalf of the Chinese company, according to the National Law Journal.
Huawei did not immediately respond to CNBC's request for comment.
Blacklist
I did a de minimis amount of work, less than 10 hours, to explain how U.S. administrative law works, I provided it to my partners, and … I've had no follow up since then.
Christopher Fonzone
Nominee for general counsel for the Office of the Director of National Intelligence
Fonzone said his work for Huawei would not affect his ability to give objective legal advice to the ODNI.
"The firm asked me to look into a question of how U.S. law works. I did a de minimis amount of work, less than 10 hours, to explain how U.S. administrative law works, I provided it to my partners, and … I've had no follow up since then," he said at a May 18 hearing.
Senator Sasse argued that Fonzone "knows full well that the Chinese Communist Party isn't interested in following the law," but is interested in "skirting" it.
'Conflict of interest'
Rubio said in the joint statement that Fonzone's work on behalf of Huawei and China's Ministry of Commerce in 2018 "raises serious questions about his judgment and decision making."
"Any nominee who is up for a key national security post and comes from a law firm or other entity that performs work for the Chinese Communist Party or a Chinese state-directed entity like Huawei requires extra scrutiny," said Rubio, who is also vice chairman of the Senate Select Committee on Intelligence.
The United States must take unified steps to combat the CCP, not put its employees and contractors in positions of power with access to sensitive information.
"I'm very aware of what (Director of National Intelligence Avril Haines) has said about Huawei and what this committee said about Huawei," Fonzone said in response. "If I was confirmed, I would be driven by what the intelligence community's views are on Huawei. That would underpin my analysis."
Senator for Arkansas Tom Cotton characterized Huawei as "a company key to the Chinese Communist Party's military and espionage apparatus" and claimed Fonzone "refused to commit to avoiding any such conflict of interest" if he is confirmed.
"The United States must take unified steps to combat the CCP, not put its employees and contractors in positions of power with access to sensitive information," he said.
As CNBC reported previously, national security laws in China would require Huawei or any other Chinese organization or individual to hand over information requested by the Beijing government as part of intelligence work.
Huawei has strongly contended that it would never hand over customer data, and Huawei told CNBC in 2019 that it has never been asked to do so.
If you're a fan of smartwatches, June 2 is a date to mark in your calendar. We already knew Huawei was hosting a launch event for its new HarmonyOS software, as the company has announced as much, but now Huawei is teasing its next-gen smartwatch will be shown off too.
On Chinese social media platform Weibo, Huawei posted the above teaser image. While it's a bit ambiguous as to what that ribbed loop is, leakers are convinced it's the Huawei Watch 3 - a conviction that makes sense when you consider the only other product we're expecting is a tablet.
One leaker in particular called Changan Digital King has provided more leaked information about the watch - apparently it'll have all-day body temperature monitoring, heart disease screening, battery life of at least three days and e-sim support. They're one of the main voices suggesting the product pictured is the Watch 3.
The leaker adds something which seems pretty obvious, in that the Huawei Watch 3 will run on HarmonyOS (we call it 'obvious' because the June 2 event is intended to showcase this new operating system, so the company wouldn't show off tech which didn't use it).
HarmonyOS on the Huawei P50
HarmonyOS is Huawei's alternative to Android, and it's an operating system that can be used on all gadgets including TVs, smartwatches, tablets, smartphones and more. We're expecting the Huawei P50 to be the first smartphone that comes with it installed, and so this Watch 3 launch could give us big clues as to the new phones.
While we likely won't hear about any features of the new phone - its cameras, design, battery life and so on likely won't be detailed - HarmonyOS on a smartwatch will likely have the same visuals as the operating system on a smartphone.
So the Huawei Watch 3 unveiling could show us what the P50's operating system could look like, which is important because EMUI (Huawei's Android overlay) had a distinct and vibrant appearance.
Oh, and if you're keen on Huawei, it's worth knowing its next tablet is expected to launch - which could have the same chipset as the P50 will.
It'll likely be the same piece of tech the Huawei Mate 40 Pro had, as the company tends to debut its home-made chipsets in its Mate phones before rolling them out to its tablets and P-series devices.
So June 2 could bring big things for all Huawei fans. We'll be tuning in, to bring you all the important information, so check back on the day for that.
Chinese smartphone maker Xiaomi Corp (1810.HK) reported first-quarter revenue growth of 55% on Wednesday, exceeding analyst expectations as it nabbed market share from one-time sector leader Huawei Technologies Co Ltd (HWT.UL).
Revenue rose to 76.88 billion yuan ($12 billion) in the quarter ended March 31, from 49.70 billion yuan a year earlier. Analysts expected revenue of 74.5 billion yen, according to Refinitiv data.
Adjusted net profit rose to 6.1 billion yuan, versus market estimates of 3.97 billion yuan.
Xiaomi's share of the smartphone market in China increased 75% year-on-year in the quarter ended late March, according to research firm Canalys, as Huawei retreated from the market following U.S. trade restrictions that crimped its ability to source key components for its handsets.
Revenue from smartphone sales jumped 69.8% year-over-year to 51.5 billion yuan, while revenue from internet services increased 11.4% to 6.6 billion yuan.
Despite the revenue growth, Xiaomi and other electronics brands remain hampered by the global chip shortage.
People wearing protective face masks visit Xiaomi brand's store, amid the outbreak of the coronavirus disease (COVID-19) in Kyiv, Ukraine October 22, 2020. REUTERS/Valentyn Ogirenko/File Photo
A number of causes such as stockpiling, surging demand for personal computers during COVID-19, and mishaps at factories caused a range of hardware makers to scramble for semiconductors late last year.
Still, on a call with investors, Xiaomi CFO Alain Lam said the company's chip inventories remained at "healthy" levels and he did not expect a major impact on business this year, though the broader shortage may not end until mid-way through 2022.
Executives also added the company intends to double the number of offline retail stores it has in China, from roughly 5,000 at present to over 10,000.
In India, meanwhile, one of its key overseas markets, the company will invest more in online sales as the government imposes strict lockdowns due to a surge in COVID-19 cases.
This quarter, Xiaomi also announced it would formally begin producing electric cars, with a new division to be led by Xiaomi founder Lei Jun.
The U.S. government also removed the company from a blacklist that would have barred U.S.-based investors from owning shares in the company, reversing one of former U.S. President Donald Trump's last maneuvers against China's tech sector before he left office. read more
The US may have finally discovered a marketplace weapon that can curb Huawei: credit.
A US-backed consortium won a nationwide Ethiopian license over the weekend with a bid 40% higher than the offer from a Huawei-linked group.
The Global Partnership for Ethiopia (GPE), which includes Kenya's Safaricom, Vodacom and Japan's Sumitomo, had offered $850 million for a nationwide license.
The rival bid, from South Africa's MTN, a long-time Huawei partner, was just $600 million. It had financial backing from China state-owned Silk Road Fund, making the licensing contest a proxy battle between the two global powers.
Clash of the titans
The DFC's critical role in this is no accident. It was set up 18 months ago specifically to counter the low-cost loans available to Chinese vendors.
The Ethiopia success suggests low-cost credit is a much more effective tool for countering Huawei than some of the other options US officials have proposed.
Open RAN is a fine idea, but it will not necessarily sideline Huawei and in any case will take years to evolve. The ideas of a national state-owned network or vendor are just non-starters.
DFC soft loans are not a solution for developed nations. Its remit is critical issues such as climate change and infrastructure in developing countries.
In telecoms it has helped fund a Myanmar tower company and in Africa it has backed operator Africell in providing services in some of the continent's poorest states.
Africa is very much Huawei turf, where, according to Nikkei, it has supplied 70% of 4G basestations, but there is plenty of opportunity in mobile. Only last year the number of 3G and 4G subscribers overtook total 2G customers.
Opportunity knocks
Ethiopia is a typical example. It has a population of 112 million and one of the biggest economies on the continent, but as a monopoly telco market it has only 40% mobile penetration and, reported Reuters, did not begin rolling out 4G until 2019.
5G is some years away. In sub-Sarahan Africa, only South Africa offers commercial 5G. Safaricom has just begun national trials in Kenya, while Nigeria and a number of other countries have run field trials.
A 2019 GSMA Intelligence report forecast that by 2025 5G would be commercial in just seven African countries and would account for just 3% of total mobile connections.
A bill now before Congress would pitch the DFC into the center of 5G rivalry in eastern Europe if passed.
The bipartisan bill, the Transatlantic Telecommunications Security Act, seeks to direct the DFC to prioritize financing for telecom networks for European allies, in particular in East Europe.
"The legislation seeks to increase resilience in countries in the region whose infrastructure deficit from the Soviet-era makes them especially vulnerable to malign Chinese influence," the bill says.
In a press release, Rep. Marcy Kaptur said the DFC funding would help provide "a viable, transparent alternative to insecure telecommunication equipment and service providers."
Related posts:
— Robert Clark, contributing editor, special to Light Reading
Vincent Peng is a senior vice president at Huawei, and a member of the company's board.
Two years ago this month, the Trump Administration placed Huawei Technologies on a blacklist that blocked U.S. companies from selling us the tech components we need to make smartphones and other products as well.
That restriction was followed by others, including a move last year to prevent Huawei from buying chips from the world's largest maker of semiconductors Taiwan Semiconductor Manufacturing Co. (TSMC), a Taiwan-based manufacturer whose chips are made with equipment from U.S. companies.
The U.S. government took these actions because it believes that as a Chinese company, Huawei could be forced to launch cyberattacks on American telecommunications networks, as well as provide Beijing with the ability to engage in espionage activity in the U.S.
Cybersecurity has dominated the news lately. Earlier this month U.S. President Joe Biden signed an executive order aimed at strengthening America's cyber defense following a ransomware attack that shut down America's biggest fuel pipeline for several days, as well as last year's damaging attacks on U.S. government agencies and private companies perpetrated through Microsoft Exchange and an IT company called Solar Winds.
If Biden's executive order leads the U.S. government to adopt a more fact-based approach to cybersecurity, that will be all to the good. In fact, the order could actually benefit both the U.S. and China -- if it is coupled with renewed American acceptance of global competition rather than a continuing slide toward protectionism.
If the Biden administration embraces competition, U.S. and Chinese companies can continue down a well-trodden path that has strengthened their intertwined economies over the past decade. But if President Biden follows Trump's lead in permitting competition only when it aligns with U.S. political aims, the global economy will extend its headlong rush into economic and technological decoupling.
In the short term, separating America's supply chains from China will hurt some Chinese companies -- including Huawei, whose overseas revenues declined last year as a result of the blacklist. But in time, decoupling will cost the U.S. an estimated $190 billion in lost GDP," according to U.S. research outfit The Rhodium Group. It will also hurt American companies' leadership in semiconductors and other technologies by shrinking their revenues and forcing them to cut R&D spending.
Unfortunately, the damage does not stop there. According to Economist Intelligence Unit estimates, a full decoupling of trade between China and the Five Eyes countries -- Australia, Canada, New Zealand, the U.K. and the U.S. -- would cost the global economy more than $50 trillion.
Even the U.S. government's own National Intelligence Council has warned that splitting the world into several economic and security blocs will impose extraordinary costs, including "massive financial losses for countries and corporations, as supply chains fracture, markets are lost, and once lucrative sectors, like travel and tourism, decline."
Washington's beef is not really with Huawei, but with China, a strategic competitor whose rise could threaten the economic and military primacy America has enjoyed for decades. Although U.S.-China relations may not thaw any time soon, it seems clear that the current administration is taking a more multilateral approach to the world than its predecessor did.
This gives us hope that there may eventually be a change in how the U.S. government chooses to treat Huawei and other global technology companies headquartered outside of the United States.
We understand that the administration is busy coping with COVID and trying to boost the U.S. economy. But we also hope that when the time is right, they will talk to us. To ease their concerns about our products and technologies, we are prepared to be subject to the most stringent controls.
We're open to discussing anything, including setting up manufacturing operations in the United States, opening Huawei's equipment to independent testing, or licensing our fifth-generation, or 5G, technology to a U.S. company or consortium.
Washington may want to consider the company's CEO and founder Ren Zhengfei's offer to license Huawei's 5G technology to an American company. The agreement could include part or all of Huawei's 5G patent portfolio, including software source code, hardware designs and technologies related to manufacturing, network planning and testing.
There are several U.S. companies that could take this on, and it seems reasonable to assume that one or two might be interested in learning more. But they are unlikely to speak up without the U.S. government's blessing.
America is in a strong position to enhance its global technology leadership by collaborating with international technology companies, including those based in China. We hope that instead of lumping together many disparate China-related issues for bargaining purposes, as his predecessor did, President Biden will disaggregate the issues and examine each one on its merits.
A better future will be built by people working together; no company or country can do it alone. The U.S. and China must find a way to compete and collaborate despite their differences.
China's Huawei Technologies (HWT.UL) said it will launch its new Harmony operating system for smartphones on June 2, its biggest move yet aimed at recovering from the damage done by U.S. sanctions to its mobile phone business.
The use of its own operating system will mean it will no longer be reliant on Android. U.S. sanctions banned Google (GOOGL.O) from providing technical support to new Huawei phone models and access to Google Mobile Services, the bundle of developer services upon which most Android apps are based.
It was not immediately clear if it will be launching new smartphones at the same time or if there will be updates for existing phones or how fast the rollout might occur.
The new HarmonyOS will only go some way to mitigating the impact of the 2019 sanctions that also barred Huawei from accessing critical U.S.-origin technology, impeding its ability to design its own chips and source components from outside vendors.
People look at smartphones in Huawei's first global flagship store in Shenzhen, Guangdong province, China October 30, 2019. REUTERS/Aly Song/File Photo
Once the world's biggest smartphone maker, Huawei now is ranked 6th globally with a 4% market share in the first quarter.
The previous Trump administration argued that the Chinese telecommunications giant posed a threat to U.S. national security - a charge that Huawei has denied.
Huawei CEO Ren Zhengfei this week called on staff to "dare to lead the world" in software in a bid to move into business areas that can't be affected by U.S. sanctions, according to an internal memo seen by Reuters.
The company will need to take a more "open source" approach to development and should try to attract more software experts from overseas as part of the pivot, it said. read more
Huawei founder Ren Zhengfei has suggested the company to switch to software in an internal memo, acquired by Reuters. According to him, the team has to “dare to lead the world” in the field because it is fundamentally more independent from the United States.
Huawei is clearly trying to diversify its business since the hardware has taken a massive hit in the past two years after being banned by the Trump administration back in 2019.
Since Huawei has been part of the Entity List (a list of companies that US organizations and citizen are not allowed to do business with without special permission), it has lost a substantial market share in the world of smartphones, and its 5G network department has been getting banned from multiple countries for good measure.
Huawei is currently working on Harmony OS - its own operating system and the center of its growing ecosystem. We expect to see mobile phones with the OS as early as next week, and the company plans to have 300 million devices with it by the end of 2021.
Ericsson provided an update to its risk factors on Monday, with the company issuing a €500 million unsecured 8-year bond.
In October last year, Sweden banned Huawei and ZTE from the nation's 5G rollouts and said telcos needed to phase out the use of any existing equipment by 2024.
Due to this, Ericsson previously said there was a risk of "collateral damages from a weakened Swedish-Chinese relationship" and retaliatory actions from Beijing. In an update on Monday, Ericsson said it expected some of those risks to become real.
"While Ericsson is invited to various ongoing tender processes in China, the final outcome remains uncertain and it is the company's current assessment that the risk has increased that Ericsson will in those tenders be allocated a significantly lower market share than its current market share," it said.
The carrier equipment manufacturer added several countries have disaggregated radio access networks and were supporting "national communication network infrastructure champions" instead of choosing one of the usual suspects like Ericsson.
"The geopolitical situation can have consequences on the entire industry, with an increased likelihood of further industry split, separation of global value chains, and separation of global standards for mobile telecommunications," it said.
On the other side of the fence, Reutersreported that Huawei founder Ren Zhengfei has pushed the company to lead in software as it was outside of US control.
In June last year, Huawei and ZTE were officially designated as national security threats by the United States Federal Communications Commission, and was added to the US Entity List, thereby preventing access to hardware containing US technology and banning the buying of parts and components from US companies without government approval.
"Once we dominate Europe, the Asia Pacific, and Africa, if US standards don't match ours, and we can't enter the US, then the US can't enter our territory," Reuters reported a memo as saying.
"2021 will be another challenging year for us, but it's also the year that our future development strategy will begin to take shape," Huawei rotating chair Eric Xu said at the time.
"No matter what challenges come our way, we will continue to maintain our business resilience. Not just to survive, but do so sustainably."
For the full year, Huawei posted net profit of 64.6 billion yuan, but its growth in markets outside of China grounded to a halt.
Earlier this month, the company revealed the extent to which it had taken a battering in Australia due to bans.
For the year to 31 December 2020, the Australian arm of Huawei reported revenue almost halving from the AU$658 million posted last year to AU$356 million.
Broken down, the company saw its carrier business continue to fade away, falling from AU$460 million to AU$217 million, its consumer business plummeted from AU$148 million to AU$84 million, while its enterprise revenue was a rare bright spot, increasing by AU$5.5 million to AU$55 million.
Huawei founder and CEO Ren Zhengfei speaks during a press briefing in Taiyuan, in China's northern Shanxi province on February 9, 2021.
Jessica Yang | AFP | Getty Images
Founder of Chinese tech giant Huawei Technologies Ren Zhengfei has called on the company's staff to "dare to lead the world" in software as the company seeks growth beyond the hardware operations that U.S. sanctions have crippled.
The internal memo seen by Reuters is the clearest evidence yet of the company's direction as it responds to the immense pressure sanctions have placed on the handset business that was at its core.
Ren said in the memo the company was focusing on software because future development in the field is fundamentally "outside of U.S. control and we will have greater independence and autonomy."
As it will be hard for Huawei to produce advanced hardware in the short term, it should focus on building software ecosystems, such as its HarmonyOS operating system, its cloud AI system Mindspore, and other IT products, the note said.
Former U.S. president Donald Trump put Huawei on an export blacklist in 2019 and barred it from accessing critical U.S.-origin technology, impeding its ability to design its own chips and source components from outside vendors.
U.S. President Joe Biden's administration has given no indication it will reverse Trump's sanctions.
The blacklist also barred Google from providing technical support to new Huawei phone models and access to Google Mobile Services, the bundle of developer services upon which most Android apps are based.
Huawei's 2020 annual report did not break down how much of its 891.4 billion yuan ($138.70 billion) revenue was from its software.
Open-source approach
Ren's note also said the software push would depend on finding the right business model and that the company should adopt an open source approach, calling on staff to "absorb nutrients" through open source communities.
He said the company's Welink business communication platform had relied on traditional software licensing, which was unsuited to cloud computing and inferior to a rival product from tech giant Alibaba.
Given the difficulty of working in the United States, Ren's note said the company should strengthen its position at home and build up its territory with a view to possibly excluding the United States.
"Once we dominate Europe, the Asia Pacific and Africa, if U.S. standards don't match ours, and we can't enter the U.S., then the U.S. can't enter our territory," it said.
Ren's note confirms a direction implied by previous announcements from the company that hinted at a shift away from handset hardware.
Rotating chairman Eric Xu in April said the company would invest more than $1 billion this year in its intelligent driving business.
It is also expanding its smart car partnership with state-owned Chongqing Changan Automobile to include the design and development of auto-use semiconductors, sources told Reuters earlier this month.
Apart from the pressure of sanctions, Huawei is known for its grueling work culture and the note recommended the software teams should hire psychology professionals to help young recruits who might find the company emotionally challenging.
"Now some young people have high IQs, but their EQ might be low, and their mentality is not mature, and it's easy for them to get sick," Ren said.
What are the main benefits of autonomous telco networks?
Greater automation surrounding service fulfilment and assurance, through “closed loop” mechanisms designed to minimize the need for manual human intervention, is clearly a key plus side when it comes to reducing carriers’ operational expenditure and speeding up time-to-revenue.
But Dr Haiping Che, chief digital transformation officer at Huawei, draws attention to a much bigger picture.
In his recent presentations at Mobile World Congress Shanghai and FutureNet World – as well as in conversation with Light Reading – Dr Che is keen not to limit comparison of network automation to autonomous driving cars, which has become a common analogy.
Instead, Dr Che talks effusively about service “production” and “output.” A more accurate description of autonomous networks, he argues, is to see them as an example of best practice in Industry 4.0 manufacturing.
By adopting smarter, Industry 4.0-type flexible-production ways of running their networks, carriers can not only raise their own production levels through greater agility in service creation and provisioning, but they can also help accelerate digital transformation (and boost productivity) in different vertical industries, including smart cities, manufacturing, and autonomous vehicles.
“I think autonomous networks for communication service products is actually equivalent to Industry 4.0 manufacturing for physical products,” asserts Dr Che. “They have common business logic, structures and frameworks.”
He goes as far as to argue that “the foundation of social progress is closer collaboration between our entire industry, the telecom industry, and other vertical industries.”
New ways of working
In an era of “smart connectivity,” which can harness clever algorithms based on artificial intelligence and machine learning, Dr Che believes autonomous networks will help carriers develop new revenue streams through an on-demand production of “network-as a service” and “network-as a platform” products.
Network as-a-service capabilities in an autonomous environment – as described in a recent whitepaper from the TM Forum – will provide “a one stop, real-time, on demand, automated, end-to-end full lifecycle of network/ICT services.” Network as a platform products are designed to “enable ecosystem collaboration between verticals and network/ICT service providers.”
The goal for autonomous networks, explains the whitepaper, is to “support a set of innovative business models and network services” for vertical industries, “as well as the digital life of consumers through fully automated and intelligent business, ICT and network operations.”
It is a vision that Dr Che fully embraces, which is hardly surprising given that Huawei, in collaboration with BT, China Mobile, Orange, and Telstra, provided initial TM Forum input into what autonomous networks might look like. Together they began an industry push to move away from pre-defined and solidified processes to more flexible ones suited for an on-demand era.
Carriers’ transition to Industry 4.0-type ways of doing things, which means becoming much more service-orientated, requires a re-architecting of networks and organizational change. Dr Che describes it as a radical shift in how the telecoms supply side is structured, moving from a large-scale, standardized, hierarchical, and rigid production mode – typical of the original “weak-connectivity” era, he says – to a “flat, collaborative, and agile production management system.”
With the supply side transformed, explains Dr Che, carriers will be able to implement an “on-demand flexible production mode”, enabling them to provide as “network as a service” and “network-as a platform” offerings, as well as more intelligent computing and intelligent edge service products.
Let’s move together in the same direction
Huawei is keen to work with different industry organizations, various equipment suppliers, system integrators, and software suppliers to turn the autonomous networks vision into reality. One supplier working alone, no matter how big, will not be able to affect industry-wide change.
Dr Che is particularly keen that the supplier ecosystem should “upgrade as soon as possible” the functionality of NE (network element) equipment to intelligent autonomous domains in different network technologies – such as wireless, network core, fiber, IP, and data center networks – driven by “intent-based” APIs.
It is an approach which Huawei is exploring in depth with carrier partners. Autonomous networks not only promise to radically reduce operational expenditure but also to improve customer experiences and ramp up “production” that Dr Che speaks about.
Networks today are built on a plethora of NEs, yet to run the NE an operator must first configure lots of parameters to activate its function. All this requires heavy lifting if using conventional O&M methods, which are labor intensive. Moreover, there is no guarantee at the end of this process that services will be delivered and maintained as expected. With billions more devices expected to be connected to the network as Internet of Things continues to ramp up, carrier O&M is only to get harder (and more inefficient).
Autonomous Networks architecture, however, allows carriers to structure their NEs into intelligent autonomous domains in which intent-based APIs “tell” what kind of service is required in terms of quality and latency. The network then auto-executes those instructions. By using artificial intelligence and machine learning, for example, carriers can move towards “closed loops” where the network looks after itself in terms of service design, rollout, provision, assurance, and optimisation. No longer will NEs have to be “hand-cranked” to do their job. “[Equipment suppliers] can introduce resource-layer operational knowledge through carrier’s E2E network operation platform [to NE equipment] and create these intelligent autonomous domains,” asserts Dr Che.
With a “smarter” network architecture in place, Dr Che suggests carriers will have the opportunity to at least rival customer experiences offered by hyper-scalers.
He talks enthusiastically of “zero-X,” a concept developed by Huawei in collaboration with TM Forum and other partners. Zero-X refers to zero-wait, zero touch and zero trouble capabilities that are needed to support a diverse set of vertical use-case requirements.
It is another example of Dr Che’s Industry 4.0 comparison, where both carriers and enterprise customer can derive mutual benefit from autonomous networks – in this instance, “seamless experiences” and “improved operational efficiencies” to the end user, where end-to-end lifecycle complexity is hidden behind the scenes and experience assurance is in inbuilt.
“We hope to work closely with industry partners and our carrier customers to promote the development of the autonomous networks industry faster, better and more steadily, and facilitate the digital transformation of various industries,” says Dr Che.
Founder of Chinese tech giant Huawei Technologies (HWT.UL) Ren Zhengfei has called on the company’s staff to “dare to lead the world” in software as the company seeks growth beyond the hardware operations that U.S. sanctions have crippled.
The internal memo seen by Reuters is the clearest evidence yet of the company's direction as it responds to the immense pressure sanctions have placed on the handset business that was at its core.
Ren said in the memo the company was focusing on software because future development in the field is fundamentally "outside of U.S. control and we will have greater independence and autonomy".
As it will be hard for Huawei to produce advanced hardware in the short term, it should focus on building software ecosystems, such as its HarmonyOS operating system, its cloud AI system Mindspore, and other IT products, the note said.
Former U.S. president Donald Trump put Huawei on an export blacklist in 2019 and barred it from accessing critical U.S.-origin technology, impeding its ability to design its own chips and source components from outside vendors.
U.S. President Joe Biden's administration has given no indication it will reverse Trump's sanctions.
The blacklist also barred Google (GOOGL.O) from providing technical support to new Huawei phone models and access to Google Mobile Services, the bundle of developer services upon which most Android apps are based.
Huawei's 2020 annual report did not break down how much of its 891.4 billion yuan ($138.70 billion) revenue was from its software.
OPEN SOURCE APPROACH
Huawei founder Ren Zhengfei attends a panel discussion at the company headquarters in Shenzhen, Guangdong province, China June 17, 2019. REUTERS/Aly Song
Ren's note also said the software push would depend on finding the right business model and that the company should adopt an open source approach, calling on staff to "absorb nutrients" through open source communities.
He said the company's Welink business communication platform had relied on traditional software licensing, which was unsuited to cloud computing and inferior to a rival product from tech giant Alibaba (9988.HK).
Given the difficulty of working in the United States, Ren's note said the company should strengthen its position at home and build up its territory with a view to possibly excluding the United States.
"Once we dominate Europe, the Asia Pacific and Africa, if U.S. standards don't match ours, and we can't enter the U.S., then the U.S. can't enter our territory," it said.
Ren's note confirms a direction implied by previous announcements from the company that hinted at a shift away from handset hardware.
Rotating chairman Eric Xu in April said the company would invest more than $1 billion this year in its intelligent driving business.
It is also expanding its smart car partnership with state-owned Chongqing Changan Automobile Co Ltd to include the design and development of auto-use semiconductors, sources told Reuters earlier this month.
Apart from the pressure of sanctions, Huawei is known for its gruelling work culture and the note recommended the software teams should hire psychology professionals to help young recruits who might find the company emotionally challenging.
"Now some young people have high IQs, but their EQ might be low, and their mentality is not mature, and it's easy for them to get sick," Ren said.
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