Feeds

ZTE calls foul over senators' 'xenophobic' letter

Protectionism by any other name...

Boost IT visibility and business value

ZTE, the Chinese telecoms equipment maker, has cried foul over a letter sent to the FCC by four US senators which suggests that Chinese companies should not be trusted with US contracts.

The letter, which comes from the Senate Committee on Homeland Security & Governmental Affairs, names Huawei and ZTE as Chinese companies from whom cellular carriers have, or may yet, source infrastructure, and asks the FCC what steps it has taken to mitigate the perceived risks.

"The unsubstantiated allegations made in the letter are disappointedly[sic] anti-competitive, protectionist and somewhat xenophobic", ZTE told Bloomberg, saying that the letter "unfairly characterises ZTE", despite the company claiming to have no connection with the Chinese government or the military.

But the tone of the letter indicates the four signatories feel otherwise, referencing reports that accuse Huawei of having "significant ties to the Chinese military", and indicating that both companies have received loans from the Chinese government - the implication clearly being that anyone who accepts a loan will be in thrall of their creditor.

It reads:

We are very concerned that these companies are being financed by the Chinese government and are potentially subject to significant influence by the Chinese military which may create an opportunity for manipulation of switches, routers, or software embedded in American telecommunications network so that communications can be disrupted, intercepted, tampered with, or purposely misrouted.

To bear out this accusation, the letter accuses both companies of "aggressively seeking to supply sensitive equipment for US telecommunications infrastructure ... and increase their role in the US telecommunications sector through acquisition and merger". Not only that, but according to the letter Huawei has been offering "low prices with attractive financing"... those inscrutable Chinese, what could they be planning?

Daily Wireless breaks down the contracts for which both Huawei and ZTE are competing, mainly with Motorola to supply dual-mode LTE/WiMAX base stations to Sprint Nextel. Daily Wireless also points out that ZTE has promised to open a US manufacturing plant and spend $3bn with US companies over the next three years.

But the senators' letter asks the FCC for a list of all the US networks already using kit from ZTE and Huawei, complete with "a detailed analysis of the geographic regions covered by those networks" and an explanation of how the FCC intends to determine if such deployments represent a risk. It goes on to ask how the FCC intends to mitigate those risks, neatly switching to an assumption that such risks exist.

Should the FCC bend before such transparent politicking, US operators will be faced with a huge pile of paperwork. This will in turn ensure that buying Chinese will always be more expensive, and if Americans can be convinced that Europe represents a similar risk, then Motorola (the only US supplier of any scale) can't lose. ®

Boost IT visibility and business value

More from The Register

next story
Pay to play: The hidden cost of software defined everything
Enter credit card details if you want that system you bought to actually be useful
HP busts out new ProLiant Gen9 servers
Think those are cool? Wait till you get a load of our racks
Shoot-em-up: Sony Online Entertainment hit by 'large scale DDoS attack'
Games disrupted as firm struggles to control network
Community chest: Storage firms need to pay open-source debts
Samba implementation? Time to get some devs on the job
Like condoms, data now comes in big and HUGE sizes
Linux Foundation lights a fire under storage devs with new conference
Silicon Valley jolted by magnitude 6.1 quake – its biggest in 25 years
Did the earth move for you at VMworld – oh, OK. It just did. A lot
prev story

Whitepapers

Gartner critical capabilities for enterprise endpoint backup
Learn why inSync received the highest overall rating from Druva and is the top choice for the mobile workforce.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.