IT concerns hurt Huawei in US and Australia

Tuesday 27th March 2012
China app. Courtesy:

In both US and Australia, Huawei Technologies, the telecoms giant, is loosing market ground. The Symantec joint venture is being dismantled because alliance with the Chinese would prevent it from obtaining US government classified information about cyberthreats while in Australia Huawei has been blocked from bidding on contracts in the $38bnn Australian National Broadband Network, citing security concerns.

In 2008, Huawei was forced to abandon a bid for 3Com, which makes anti-hacking computer software for US and in 2010, it lost a bid to supply mobile telecom equipment to Sprint Nextel after lawmakers expressed similar concerns.

Now Huawei is reported to have laid off workers in Huawei Symantec’s Silicon Valley offices and plans to move its entire operation out of the US. Symantec expects to sell its 49% stake in the venture to Huawei for $530m. 

William Plummer (right) a Huawei spokesman, said that from Huawei’s perspective “both companies had apositive experience with the joint venture.” He added, “We are going to streamline the organisation market by market including in the US.”

Now Australia has blocked Huawei from bidding on contracts in the $38bn Australian National Broadband Network, citing security concerns. 

“We were informed by the government that there is no role for Huawei” in the network, said (left) Jeremy Mitchell, Australia spokesman for Huawei, one of the world’s largest suppliers of telecommunications equipment.

The $38bn Australian network plan expected to be ready in 2020 is the largest infrastructure project in the country’s history. It is intended to connect 93% of homes and workplaces with fiber-optic cable, providing broadband service in urban and rural areas.

Currently Huawei covers Europe and has a UK base with a strategic partnership with Vodaphone and is even a member of the Prince's Trust, and China links in Scotland are quietly commercially extensive

In October last year in Scotland the private equity firm Blackstone agreed a deal with China Investment Corp (CIC) for it to buy up high risk property loans from Royal Bank of Scotland. The £1bn deal discounted from £1.4bn face value, sees half of the portfolio going to sovereign-wealth fund CIC.

In Europe it is pointed out that low-risk investments that provide steady income streams are of interest to  Beijing that has an interest in European companies and our energy, from the purchase of Pireus port, to a 40% stake in the Portugese electricity grid to the of 8, 68% of Thames Water, the company that supplies drinking water to London. 

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