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Huawei To Back Off US Market Amid Rising Tensions (nytimes.com)

Posted by BeauHD on from the reverse-course dept.

Huawei is reportedly going to give up on selling its products and services in the United States (Warning: source may be paywalled; alternative source) due to Washington's accusations that the company has ties to the Chinese government. The change in tactics comes a week after the company laid off five American employees, including its biggest American lobbyist. The New York Times reports: Huawei's tactics are changing as its business prospects in the United States have darkened considerably. On Tuesday, the Federal Communications Commission voted to proceed with a new rule that could effectively kill off what little business the company has in the United States. Although the proposed rule does not mention Huawei by name, it would block federally subsidized telecommunications carriers from using suppliers deemed to pose a risk to American national security. Huawei's latest moves suggest that it has accepted that its political battles in the United States are not ones it is likely to win. "Some things cannot change their course according to our wishes," Eric Xu, Huawei's deputy chairman, said at the company's annual meeting with analysts on Tuesday. "With some things, when you let them go, you actually feel more at ease."

46 of 91 comments (clear)

  1. Yeah... by Parker+Lewis · · Score: 4, Interesting

    "suppliers deemed to pose a risk to American national security" == "suppliers do not accept to sell products with NSA backdoors"

    1. Re:Yeah... by AmiMoJo · · Score: 3, Insightful

      Seems very bad for trade too. There are two ways to address the trade imbalance with China: reduce overall trade until both sides are down to the same level, or build up US exports to match Chinese imports. It seems like, as usual, this trade war is pushing for the first option.

      --
      const int one = 65536; (Silvermoon, Texture.cs)
      SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
    2. Re:Yeah... by Anonymous Coward · · Score: 5, Interesting

      I don't think Huawei would have let this go so easily if that were the reason. They'd either have inserted the backdoor like presumably the other suppliers, or they'd have let the public know that the NSA wanted them to insert a backdoor into their products but that they refused to do so. I think it's more likely that some of Huawei's products contain PRC backdoors and that they aren't prepared (or legally able) to remove them.

    3. Re:Yeah... by sg_oneill · · Score: 5, Insightful

      "suppliers deemed to pose a risk to American national security" == "suppliers do not accept to sell products with NSA backdoors"

      Huwai and the Chinese govt probably couldnt give a damn about the NSA spying on american citizens anymore than the american govt caring about china spying on chinese citizens. Its only when it crosses the border do govts get anxious.

      None of the actors here actually give one knob of goatshit about our rights.

      --
      Excuse the Unicode crap in my posts. That's an apostrophe, and slashdot is busted.
    4. Re:Yeah... by ColdBoot · · Score: 1

      "suppliers deemed to pose a risk to American national security" == "suppliers do not accept to sell products with NSA backdoors"

      or restated, the Chinese will do to us what we do to them

    5. Re:Yeah... by Ritz_Just_Ritz · · Score: 1

      As opposed to Chinese government backdoors? No thanks.

    6. Re:Yeah... by houghi · · Score: 1

      I rather have that only the Chinese read my emails than the Chinese, the Russians and the Americans.

      --
      Don't fight for your country, if your country does not fight for you.
    7. Re:Yeah... by sinij · · Score: 2, Insightful

      More trade is not always automatically better. For example, China due to ability to centrally plan, lax labor standards, nonexistent environmental regulations, can produce trade goods at a loss for decades. At that point our own capacity to produce similar goods is lost and we become a captive market dominated by foreign state-aligned monopoly.

    8. Re:Yeah... by AmiMoJo · · Score: 1

      Sure, but there are better ways to solve those issues. For example, the EU introduces the RoHS rules that limited the amount of harmful substances in products, and started considering carbon emissions from factories in China making products for EU companies. That helped clean up China quite a bit, and the Chinese government is very receptive to such measures because it too is trying hard to improve the environment there.

      If you just start a trade war it will only result in more tariffs being put on US products. Maybe more of them will be sold in the US to make up for that, but the Chinese market is huge and experiencing rapid growth so that's far from certain. And of course the Chinese put tariffs on US goods in a way designed to cause maximum pain, rather than make the system fairer.

      --
      const int one = 65536; (Silvermoon, Texture.cs)
      SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
    9. Re:Yeah... by ooloorie · · Score: 1

      There are two ways to address the trade imbalance with China: reduce overall trade until both sides are down to the same level, or build up US exports to match Chinese imports.

      You can't "build up" US exports because the Chinese are already spending every dollar they get their hands on, just not on US exports of goods and services. What are they spending their dollars on? US treasury bills and US investments. And that's a system that American politicians like because it allows them to buy votes in the US (with government spending) and drives up the price of land and the stock market.

      The solution is also simple: balance the budget. It might also be worth limiting the classes of assets the Chinese can buy in the US, just like it is limited in the other direction.

    10. Re:Yeah... by AmiMoJo · · Score: 1

      Well European cars are selling really well in China. It's the biggest growth market by far for companies like BMW, Jaguar and Audi. Japanese manufacturers are making inroads too, despite the history of their two countries.

      Chinese consumers love western brands too. They aren't dumb either, they know that fakes are fake, and value the real thing if they can afford it. Again, it's a rapidly growing market for Prada and Louis Vitton.

      --
      const int one = 65536; (Silvermoon, Texture.cs)
      SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
    11. Re:Yeah... by AmiMoJo · · Score: 1

      The EU authoritarian? Okay buddy.

      In any case, the EU certainly protects consumers a lot more than the US. That's one of the major reasons why US companies find it so hard to sell stuff here, and the same in Japan where they can't meet the automotive emissions standards, for example.

      --
      const int one = 65536; (Silvermoon, Texture.cs)
      SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
    12. Re:Yeah... by NicknameUnavailable · · Score: 1

      For US products it's better to have NSA backdoors than Chinese backdoors. I'd rather have neither of course, but as little as alphabet agencies may be our friends, the most a foreign government is capable of being is an ally, and China isn't even that.

    13. Re:Yeah... by Parker+Lewis · · Score: 1

      I don't live in USA, so both are foreign agencies spying in my devices. Anyway, doesn't matter, as having a backdoor does it mean anyone (mainly hackers) will be able to use the same backdoor.

    14. Re:Yeah... by ooloorie · · Score: 2

      In any case, the EU certainly protects consumers a lot more than the US.

      Translation: "The EU has a lot of trade barriers."

      That's one of the major reasons why US companies find it so hard to sell stuff here, and the same in Japan where they can't meet the automotive emissions standards, for example.

      US standards are much stricter when it comes to NOx and particulates (the stuff that you need to protect consumers from), while being less strict when it comes to carbon emissions (irrelevant to consumer protection). That's why we had Dieselgate.

      The EU authoritarian? Okay buddy.

      Yes, "buddy", it's why I left the EU and came to the US.

    15. Re:Yeah... by alexgieg · · Score: 1

      What they don't get is no country can hemorrhage money in trade.

      Actually, that's the basis of the Libertarian argument. If you have no trade barriers at all, and no government messing things up, then your trade is naturally limited to your production, that is, you can import as much as you export, because if you have nothing to export, you have no money with which to import anything. As such, want to import more? Ramp up your own internal production so as to have something others are interested in, then trade.

      Notice that this isn't a zero-sum game as protectionists like to believe. As long as everyone is producing things, there's trade between everyone, so mutual wealth increases, after all, no one buys things they think are worth less than what they're selling in exchange, and this is valid for both sides in any trade agreement, so that whenever an exchange freely happens, both sides come out of it better than they were before.

      --
      Conservatism: (n.) love of the existing evils. Liberalism: (n.) desire to substitute new evils for the existing ones.
    16. Re:Yeah... by NicknameUnavailable · · Score: 1

      I don't disagree, but as an American I'd rather my own government have it than the Chinese.

  2. So no more Cisco gear? by drinkypoo · · Score: 3, Insightful

    Although the proposed rule does not mention Huawei by name, it would block federally subsidized telecommunications carriers from using suppliers deemed to pose a risk to American national security.

    Oh yeah? So that means they're going to stop buying equipment from Cisco, right?

    --
    "You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
  3. It's not surprising that they'd give up by GrumpySteen · · Score: 1

    Huawei's market share in the US is microscopic at best. Most carriers don't offer their products and Congress has recommended against working with them for years. With the FTC looking to block subsidized carriers from working with them, the US market simply isn't worth the effort and expense anymore.

    1. Re:It's not surprising that they'd give up by Freischutz · · Score: 2

      Huawei's market share in the US is microscopic at best. Most carriers don't offer their products and Congress has recommended against working with them for years. With the FTC looking to block subsidized carriers from working with them, the US market simply isn't worth the effort and expense anymore.

      Who cares about 'facts' when this plays well with the base. Just like those steel tariffs the White House justified by citing Chinese steel dumping, China accounts for 2.9 percent of US steel imports, ... but who cares about 'facts', tariffs on China play well with the base. I don't think US politicos, and particularly the ones in charge at the moment, really think much beyond what will 'play well with the base'.

    2. Re:It's not surprising that they'd give up by JackieBrown · · Score: 4, Insightful

      Just like those steel tariffs the White House justified by citing Chinese steel dumping, China accounts for 2.9 percent of US steel imports, ... but who cares about 'facts', tariffs on China play well with the base

      Then why would this result in a trade war if it doesn't actually effect anything?

    3. Re:It's not surprising that they'd give up by ledow · · Score: 1

      10% worldwide:

      https://www.statista.com/stati...

      I don't think that's "microscopic" but it's hard to nail down stats for the US on its own.

      That's literally hundreds of millions of devices, though, so I don't think we're talking about something that can just disappear overnight without anyone noticing.

    4. Re:It's not surprising that they'd give up by GrumpySteen · · Score: 1

      Re-read my comment. I said. "Huawei's market share in the US is microscopic" not that their global market share is small.

      Huawei is a successful global company and the US is a microscopic part of their global sales. We don't add enough to their bottom line for them to continue bothering with us if we're just going to keep adding obstacles to prevent them from growing their business here.

    5. Re:It's not surprising that they'd give up by ledow · · Score: 1

      Yes, and it's hard to nail down the stats for the US.

      I read everything from 0.1% to 5% and at those margins of error anything could be true.

      But even 1% isn't insignificant. However, if a company owns 10% of the world market, it makes me wonder why you'd want to exclude them without some incredibly good reason. For example, all the US's European allies are quite happy using their kit.

      It seems to me to be nothing more than hyperbole, while they're using Cisco electronics and Chinese-built Apple devices, etc. etc. and it just builds on the "made in US" rhetoric more than it's actually a sensible thing to do.

    6. Re:It's not surprising that they'd give up by Curunir_wolf · · Score: 1

      Well carriers' deals on phones suck now, so I just buy them outright. I have a Huawei phone and it's the best smart phone I've ever had.

      --
      "Somebody has to do something. It's just incredibly pathetic it has to be us."
      --- Jerry Garcia
    7. Re:It's not surprising that they'd give up by datavirtue · · Score: 1

      Huawei has been getting slapped in the US for a while now. The carriers and other phone interests realized that their phones were going to change the market. High quality, unlocked, they are protecting AT&T, Verizon, and other phone makers. Huawei becoming a major player in the US would have shaken things up quite a bit. All it takes is one of your wife's friends buying a Huawei Honor and getting on Simple Mobile to show her how she is getting screwed over by getting locked into a two year contract with Verizon so she can get a stupid iPhone. Not worth it--the churn and $70 per line (plus $30 for the phone) shit is getting old. In the end your costs are more than halved by snagging a decent Huawei phone and using one of the T-Mobile resellers.

      My wife alone was paying $70 a month just for a data plan on Verizon. I bought a few Huawei Honor 8 phones ($300 ec on Amazon) and ported our numbers to Simple Mobile (in a few minutes) ...total cost $50 a month for two phones.

      These are the best unlocked phones...feature parity and equal quality of Samsung and Apple at less than half the price.

      --
      I object to power without constructive purpose. --Spock
  4. paywalled by Reverend+Green · · Score: 5, Insightful

    Please stop posting paywalled links. No one here wants to read them. No one here wants paywalled sites to get any traffic.

    1. Re:paywalled by atrex · · Score: 1

      What's worse: a paywalled site getting less traffic or a paywalled site getting adblocked traffic that blocks the poorly implemented paywall?

    2. Re:paywalled by NicknameUnavailable · · Score: 1

      And how exactly are sites supposed to make money?

      They have the option of selling their buttholes to the highest bidder just like every other artist does, they aren't special because they write for the NYT.

  5. Re:In completely unrelated news by Freischutz · · Score: 3, Insightful

    Apple's stock goes up on their ability to be complacent. Tim Cook announces another great leap in innovation by Apple since Jobs' passing. The next iPhone is going have more RAM and a slightly different camera!!!!

    And Apple's political contributions just went up. Again.

    WTF, does any of this have to do with Apple?

  6. Americans had better get used to paying more. by Computershack · · Score: 2, Insightful

    As more and more companies in China decide its no longer worth selling into the US market that means a lot of cheap consumer gear is going to disappear. Component manufacturers may follow suit. I think the American public is going to be in for a rude awakening about just how much of what they buy comes from China.

    --
    I only please one person per day. Today is not your day. Tomorrow isn't looking good either. - Scott Adams
    1. Re:Americans had better get used to paying more. by Anonymous Coward · · Score: 2, Interesting

      I think the American public is going to be in for a rude awakening about just how much of what they buy comes from China.

      Taiwan, South Korea, Malaysia, and The Philippines have got us covered.

    2. Re:Americans had better get used to paying more. by Howitzer86 · · Score: 1, Interesting

      If electronics become too expensive for the average consumer, we'll just keep what we have and buy used from the wealthier folks. Meanwhile, I hope the remaining manufacturers get the message and build things that last longer and are easier to repair.

    3. Re:Americans had better get used to paying more. by WindBourne · · Score: 2

      No, most Americans are well aware of how much garbage comes from china. CHina has worked hard to kill off electronic, led, solar, EV, etc manufacturing in the west. That includes in Europe. The best thing that can happen is that CHina either start playing by WTO rules, OR we bring back manufacturing, with lots of automation, to the west.

      --
      I prefer the "u" in honour as it seems to be missing these days.
    4. Re: Americans had better get used to paying more. by cunina · · Score: 1

      Good. Fuck the American public. They need to learn the real cost of things they buy. This is unquestionably a positive change.

    5. Re: Americans had better get used to paying more. by DNS-and-BIND · · Score: 1

      What good are cheap crap goods if nobody has the money to buy them? This benefits our working class at the expense of our wealthy. Force China to accept our goods at the same rates we tax theirs at. If they won't play fair, fuck them.

      --
      Shutting down free speech with violence isn't fighting fascism. It IS fascism!
    6. Re: Americans had better get used to paying more. by DNS-and-BIND · · Score: 1

      Good job with the hostility there. Gonna win a lot of elections with that attitude.

      --
      Shutting down free speech with violence isn't fighting fascism. It IS fascism!
  7. Shades of NSA vs Kaspersky by ve3oat · · Score: 1

    I'm glad that Kaspersky products are still available off the shelf here in Canada (from an American-owned retailer, no less). Not sure what to think about Huawei though.

  8. Every Chinese Company has ties to the Chicom Gov by Anonymous Coward · · Score: 1

    China is still an authoritarian communist regime.

    Every fucking company in China is subject top the whims of the government. What fucking morons believe this NOT to be so?

  9. good by WindBourne · · Score: 1

    In this case, this company has hired a few Americans, but prohibited them from owning ANY STOCK IN THE COMPANY. In fact, no westerners are allowed to obtain stock in it.

    --
    I prefer the "u" in honour as it seems to be missing these days.
    1. Re:good by butchersong · · Score: 1
      It was formed by a retired Chinese military officer and doesn't even call itself a private company: https://en.wikipedia.org/wiki/...
      Excerpt:

      Huawei classifies itself as a "collective" and does not refer to itself as a private company. Richard McGregor, author of The Party: The Secret World of China's Communist Rulers, said that this is "a definitional distinction that has been essential to the company's receipt of state support at crucial points in its development

  10. Re:Every Chinese Company has ties to the Chicom Go by easyTree · · Score: 1

    Only USA USA USA may compromise communication devices sold in the US?

    --
    Requiem for the American Dream
  11. Shame by p51d007 · · Score: 1

    I've had 3. Mate2, 8, 9 Very good phones, EXCELLENT 4,000mAH battery, stable, rock solid. I guess the Apple/Samsung duopoly will continue, and, American consumers will continue to overpay for phones considering most consumers will continue to buy them from carriers, so they can have the newest Apple/Samsung phone, for zero down, no interest payments. I'll bet dollar to doughnuts some k-street money, compliments of Apple/Samsung flowed through the halls of DC, to get them to turn a sour note to Huawei. Shoot, that or the FBI, CIA, NSA etc weren't able to get a backdoor into the phones. As long as they have the LTE frequencies for the USA, I'll continue to buy them. Damn good phones

  12. Mate9 by p51d007 · · Score: 1

    As was the 8 and the 2 before it. I've NEVER had an issue with Huawei's Mate series. Best phones I've ever owned.

  13. Re:In completely unrelated news by datavirtue · · Score: 1

    "The next iPhone is going have more RAM and a slightly different camera!!!!"

    To keep feature parity with Huawei Honor series....

    --
    I object to power without constructive purpose. --Spock
  14. Re:In completely unrelated news by ebonum · · Score: 1

    I think everyone missed my point. Huawei makes some very good phones. Phones that will take away market share from Apple. Apple must be trilled that Huawei can't sell in volume in the USA. Stepping back, if Huawei can't sell here, Apple wins, but Samsung is biggest winner.