In Huawei's Bid to Crack Market, U.S. Sees a Threat From China Inc

[RollingStones]

From this post it is quite obvious that you have never even visited China.

Or even used 10 seconds to look up the Wikipedia page on the Chinese economy.

I'll give you some help, look up the "private sector" of the Chinese economy, and you will see that the "private sector" is actually the part that is contributing the most growth to our economy.

What you FAIL to state is that this law came into force only in 2007 - 30 years after China opened up - after the CPC was pushed into coming up with a Property Law. At least that's what wikipedia states. China is facing new economic realities and I am not surprised that old communist laws are giving way to more capitalistic laws and tools. But I think China needs to do this at a more rapid pace . But lets not feign that China has had property rights before 2007.

 

[Chinese-Dragon]

Pffft you just live there. I'd rather trust him.

LOL that would be too mean. He clearly doesn't know anything about the situation at all.

I'll let him read up more on China's private sector first. Maybe he can even discover when "privitization" in China actually started.

 

[CardSharp]

LOL that would be too mean. He clearly doesn't know anything about the situation at all.

I'll let him read up more on China's private sector first. Maybe he can even discover when "privitization" in China actually started.

He's American and he's got free media, of course he's right. Stop arguing with him fool.

 

[ashant]

Well, it sure does not take long for a thread like this to derail!

The real issue here is that there is no level playing ground in business. It's difficult for even the European telecom equipment vendors to win contracts in the USA. However, the opposition is much more subtle and not so blatant. It's easy to play the China card to keep away Chinese competition, and that's exactly what's being done here.

There is a saying in the telecom world since the mid 2000s: Huawei and Zte are not good, they are very very good. Nowadays, if you go to any telecom operator in asia/africa/eastern europe/latin america, and check their switching stations, you will see that they are filled wall to wall with Huawei/ZTE equipment. Any telecom operator in their right mind will want to reduce their capex and it's here that the Chinese telecom vendors win big time. But, this does not come at the cost of quality. It cannot, since operators want a network which gives at atleast 99.99% uptime.

The only areas where Huawei and ZTE are relatively weaker is in the software around the switching components e.g. element managers, fault management systems etc. for monitoring the switches. However, they are maturing fast, and now Huawei makes okayish (and cheap) telecom billing software as well.

Huawei had a history of allegations of industrial espionage and were accused by Cisco for allegedly copying their entire source code for IP routers. However, it is also said (conjecture and hearsay, no source) that Huawei only sold these copied routers in China. For good or bad, to compete with big incumbents, you need to start somewhere.

So, the truth now is, that Huawei has come a long way and is a hefty competitor. Zte is not very far behind. You should check the number of patents that only these two companies are churning out. And this is very uncomfortable for the competition. NokiaSiemens/Nortel/Cisco/Ericsson/Alcatel/Juniper etal are fighting hard and this has triggered the next round of innovations and cost cuts to stay competitive.

In a sense, this move by USA is a case of classic FUD (Fear, uncertainity, doubt), triggered by equipment vendors there. For American vendors, their local market is the last savior, as they are getting hammered on prices in other markets (Except Cisco and Juniper, nothing much sells in large volumes). This move will impact American telecom operators, as their capex will be higher, which will in turn result in data and call rates being higher in America. All other concerns like China taking over the country's telecom networks etc. is hogwash , as it is not possible to do so. Let's see how China retaliates in this trade war.

 

[CardSharp]

Well, it sure does not take long for a thread like this to derail!

The real issue here is that there is no level playing ground in business. It's difficult for even the European telecom equipment vendors to win contracts in the USA. However, the opposition is much more subtle and not so blatant. It's easy to play the China card to keep away Chinese competition, and that's exactly what's being done here.

There is a saying in the telecom world since the mid 2000s: Huawei and Zte are not good, they are very very good. Nowadays, if you go to any telecom operator in asia/africa/eastern europe/latin america, and check their switching stations, you will see that they are filled wall to wall with Huawei/ZTE equipment. Any telecom operator in their right mind will want to reduce their capex and it's here that the Chinese telecom vendors win big time. But, this does not come at the cost of quality. It cannot, since operators want a network which gives at atleast 99.99% uptime.

The only areas where Huawei and ZTE are relatively weaker is in the software around the switching components e.g. element managers, fault management systems etc. for monitoring the switches. However, they are maturing fast, and now Huawei makes okayish (and cheap) telecom billing software as well.

Huawei had a history of allegations of industrial espionage and were accused by Cisco for allegedly copying their entire source code for IP routers. However, it is also said (conjecture and hearsay, no source) that Huawei only sold these copied routers in China. For good or bad, to compete with big incumbents, you need to start somewhere.

So now, the truth now is, that Huawei has come a long way and is a hefty competitor. Zte is not very far behind. You should check the number of patents that only these two companies are churning out. And this is very uncomfortable for the competition. NokiaSiemens/Nortel/Cisco/Ericsson/Alcatel/Juniper etal are fighting hard and this has triggered the next round of innovations and cost cuts to stay competitive.

In a sense, this move by USA is a case of classic FUD (Fear, uncertainity, doubt), triggered by equipment vendors there. For American vendors, their local market is the last savior, as they are getting hammered on prices in other markets (Except Cisco and Juniper, nothing much sells in large volumes). This move will impact American telecom operators, as their capex will be higher, which will in turn result in data and call rates being higher in America. All other concerns like China taking over the country's telecom networks etc. is hogwash , as it is not possible to do so. Let's see how China retaliates in this trade war.

Thank you, it's good to see China catching up on the quality department. Now that you've brought thread on topic, isn't this pretty inane compliant by the US, considering that a lot telecomms equipment made in the USA subcontracts component all over the world? As far I know nobody keeps track of what was made where for US companies.

 

[us1956]

Yeah....im pretty sure thats not gonna fly either.

there are couple things you may not know...
-president Obama told Mr. HU, he want to sell most if not all "what China wants to buy" and love to see China buys more and more
-and asking for China's investment in U.S. on national tv
-buying 2-3 million dollars asset from a defunct computer system company has nothing to do with national security interest

 

[Bigoren]

You mean the mainland Chinese lease it from the Chinese government. Doesn't the government own all property in mainland China? HK SAR of course is different. We all know that. HK SAR is a capitalist system - one country, two systems and all that crap.

omg,you are definately a stupid jerk.Go do some research before you say that all property belong to the CPC!! Typical american ONLY hear to CNN?I see.

 

[ashant]

@CardSharp: Well, it's not inane really, more a way to keep out competition. All kinds of dirt, real or imaginary will be used to achieve this goal and in the anglo-saxon way of doing business, I guess this tactic is deemed fair. In western Europe, the big operators are still loyal to their older vendors, but have given some business to Huawei/Zte and they are more or less entrenched in developing markets. Thus for the Chinese telecom vendors, the large American market is the final frontier. Huawei is also a board member of the Open Patent Alliance, OPA for short which directly challenges Qualcomm's dominance in WCDMA 3G technology. Currently, equipment vendors have to pay a hefty sum to Qualcomm on a pro-rata basis of the whole equipment cost (not just price of the wcdma chipset). Hence Qualcomm too will be gunning for huawei to protect their profits.

Huawei is more or less a global company, by Chinese standards at least. They employ people around the world for projects, though the final decision is still very centralized and their hq micromanages the non-Chinese managers (This is changing a bit, as Huawei is getting more global.Similar phenomenon seen in Indian service MNCs too.). So, the complaint will not hold much water. However, one problem for Huawei is their shareholding , where the union of Shenzhen, huawei holds ~ 98% and Ren Zengfei holds the rest. This will be treated as a negative in America. Maybe one solution is to sell some of it's stock to American shareholders and get a few American corporates on the board. This should go a long way in countering some of the propaganda. How these vendors navigate the propaganda against them will be a test of their business acumen.

 

[RollingStones]

omg,you are definately a stupid jerk.Go do some research before you say that all property belong to the CPC!! Typical american ONLY hear to CNN?I see.

ALL that changed ONLY in 2007. No point pretending as if his was always the case.

 

[CardSharp]

@CardSharp: Well, it's not inane really, more a way to keep out competition. All kinds of dirt, real or imaginary will be used to achieve this goal and in the anglo-saxon way of doing business, I guess this tactic is deemed fair. In western Europe, the big operators are still loyal to their older vendors, but have given some business to Huawei/Zte and they are more or less entrenched in developing markets. Thus for the Chinese telecom vendors, the large American market is the final frontier. Huawei is also a board member of the Open Patent Alliance, OPA for short which directly challenges Qualcomm's dominance in WCDMA 3G technology. Currently, equipment vendors have to pay a hefty sum to Qualcomm on a pro-rata basis of the whole equipment cost (not just price of the wcdma chipset). Hence Qualcomm too will be gunning for huawei to protect their profits.

Huawei is more or less a global company, by Chinese standards at least. They employ people around the world for projects, though the final decision is still very centralized and their hq micromanages the non-Chinese managers (This is changing a bit, as Huawei is getting more global.Similar phenomenon seen in Indian service MNCs too.). So, the complaint will not hold much water. However, one problem for Huawei is their shareholding , where the union of Shenzhen, huawei holds ~ 98% and Ren Zengfei holds the rest. This will be treated as a negative in America. Maybe one solution is to sell some of it's stock to American shareholders and get a few American corporates on the board. This should go a long way in countering some of the propaganda. How these vendors navigate the propaganda against them will be a test of their business acumen.

Thanks for another informative post. Question. Huawei's challenge against Qualcomm is this a way for China to grab world 3G marketshare with its own 3G tech? Also what is the situation for 3G in China? I heard that there were complaint against China not letting in foreign 3G providers (Qualcomm?) until its own 3G (TD-SCDMA?) is mature enough to compete.

Sorry for the question, am a Chem major, very ignorant about tech.

 

[gpit]

Censoring **** ? Nah!!some facts about Tank Man, makes weasels out of Chinese government.

....

Fact about the tank man shows that PLA cares so much about life, and the government cares so much about human rights. The tank man is not harmed in the slightest sense.

If this happens in Indian Golden Temple India Sikh Golden Temple Massacre 1984, forget it!

If it happens in Kent State University, Ohio, Kent State shootings - Wikipedia, the free encyclopedia, not a chance!

Case closed.

 

[gpit]

So pretty much China wants the world to be communist. ..

Never heard of that. At least not any more.

But we do hear the west wants the whole world to be democratic. India has been democratic with 2 millon kids fell prey of it each year... and funny many of you are happy about it

 

[gpit]

This "growth" will not last so long as you decide not to be transparent or employ unfair methods to meet your ends. Karma is a bit3h.

This "growth" will not last so long as you decide not to be transparent or employ unfair methods to meet your ends. Karma is a bit3h.

Incredibly clownish!

But the hard fact is that the growth is not controlled by you, neither is karma.

 

[gpit]

I know it has nothing do with IP. But under communism everything belongs to the government right...

Congratulations on your finding a perfect way to show off your blatant ignorance.

But, don't try to equal Chinese communism with your dynastic democracy.

 

[gpit]

So it really is true, you folk will go any length to justify chinese atrocities and related bull. Even if it means having your own credibility shot to hell. As for huawei though, the states really ought to be careful. Because apparently....cutting a deal with huawei would mean compromising on national security secrets to the chinese government.

Why don’t you stop justifying your atrocity in terms of negligence (2 million children starved to death EVERY YEAR, vast illiteracy, etc.) and massacres (Golden Temple massacre, etc.), before pointing your shivering finger to the other?

At least in present day, China has no people died of starvation.

GoI is careful enough to having Huawei on its side in controlling Indian market. Karma seems in working, no?