House Intelligence Committee Says Huawei, ZTE May Be Under Influence Of Chinese Government

A new report written by the US House of Representatives Intelligence Committee has concluded that both Huawei and ZTE, two Chinese smartphone manufacturers should be prevented from expanding their business in the US. The report and findings follow an 11-month investigation into both companies, as reported via Reuters which saw a draft of the House report saying that both companies may be subject to the influence of the Chinese government, possibly representing an espionage threat.

“U.S. network providers and system developers are strongly encouraged to seek other vendors for their projects….[Huawei and ZTE] cannot be trusted to be free of foreign state influence and thus pose a security threat to the United States and to our systems.”

The report further says that there are “credible allegations” that Huawei is guilty of bribery, corruption, discriminatory behavior and copyright infringement. Both companies are rapidly growing in the telecommunications market, which is comprised of electric power grids, banking and finance systems; gas, oil and water systems and rail and shipping, all of which are critical installations for the US.

For its part, Huawei spokesperson Bill Plummer calls the report “Baseless suggestions…that Huawei is somehow uniquely vulnerable to cyber mischief ignore technical and commercial realities, recklessly threaten American jobs and innovation, do nothing to protect national security, and should be exposed as dangerous political distractions from legitimate public-private initiatives to address what are global and industry-wide cyber challenges.”

ZTE stated that it “profoundly disagrees” with any claim that is controlled or directed by the Chinese government. “ZTE should not be a focus of this investigation to the exclusion of the much larger Western vendors,” it said.

Plummer’s comments were submitted to Reuters in email. For now, it’s not clear how the report will affect the interests of both parties in the US or their existing relationships with MetroPCS, Sprint, Verizon Wireless and T-Mobile.

During last nights 60 minute report it was noted that when Sprint was looking at entering into a strategic relationship with Huawei for network equipment, the government contacted Sprint CEO Dan Hesse and killed the deal.

We expect this story to gain some more steam after the full report is released by House Intelligence committee.

Reuters

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  • g2a5b0e

    I don’t even know what to say about this. I’m just glad phones from neither one of these companies have ever been on my purchase radar.

    • mikkej2k

      T-Mobile had the Tap a few years ago. Not good.

    • fixxmyhead

      yea everytime i think of huawei the first thing that comes to mind is the huawei comet phone. its gotta be like the worst android phone EVER. i always get a laugh when i see people with that phone

  • Jim

    news? meh

    • http://tmonews.com David

      It’s news, though it not may particularly interesting to those who just care about phone reporting. T-Mobile carries products from both, that makes it relevant in my eyes.

      • davedsone

        I saw the report last night, just the response of Huawei and their attitude during the interview seemed condemning. The point being made wasn’t that they did bad things with the equipment, it was about being in a position to do so, and having had much help from the Chinese government and maybe being an instrument of the state. Pretty big news, really. Mostly about infrastructure more than phones, Huawei provides an entire range of equipment to set up a 4g network, and Cisco does not. So they are being integrated into our telecommunications network at a level that would allow them to disrupt it or use it for espionage.

        • TMOTECH

          Not T-Mobile. We use Alcatel, Nokia, Ericsson, and Nortel for infrastructure. I am concerned about what they may be able to install into the android OS that may be undetectable.

        • mikkej2k

          One more reason for NO bloatware or skins. Stock phones and software.If I want espionage software on my phone let ME put it there.

        • davedsone

          I was more saying THAT is what the government was worried about, not phones per se, but Huawei was going to be deeply integrated into the network infrastructure. Lets face it, most of the phone vendors already screwed up on privacy issues long ago. I for one LOVE skins, don’t really care about bloatware now that phones have enough storage. Skins help Android improve by being a testbed for new features.

        • archerian

          I agree, millions of users had CarrierIQ’s agent running none the wiser… it can be done

  • Anonymous

    If sprint had killed the deal as part of the government favor, then that means the government may owe sprint a favor now. I wonder what trick will be pulled out the hat, especially right after an election term! A merger stoppage maybe.i’m being sarcastic!

    Personally I wouldn’t use the sub par quality phones, in general most of these smartphones seems to be invading all sensitive information of the consumers.The government isn’t saying much about that though, only to protect their top classified information and infrastructure.

  • Greek

    so far there is no proof the equipment is compromised just that they could be and the committee is basing this on the fact the company will not give the house everything about each of the companies

  • NOTE Taker

    Happy the government is taking an active position on advising against doing business with these companies. Though I’m not so confident in corporate bodies to out national security over profits. It’s also sad that most of the folks who share my enthusiasm for tech really can’t care less about these subjects.

  • http://benpike.net/ Ben Pike

    …where’s my tinfoil hat when I need it…

  • archerian

    There have been reports of this from other governments too, mainly regarding their network equipment. Wonder if this extends to devices too, they use SoC from popular vendors, give their device to the FCC for validation, assemble their device in China (like other major vendors) and use Android. Unless they have custom code or something along with their version of Touch/TouchWiz whatever its called.

  • dirtyblueshirt

    I knew about Huawei and ZTE’s track records long ago when they started permeating the US Market. Just remember, just because there’s no concrete evidence in the /unclassified/ public report; it doesn’t mean it does not exist. It’s there.

    • googlephone

      You are a criminal. Just because there’s no concrete evidence, it doesn’t mean you are not. So you should to to jail.

      • dirtyblueshirt

        You should re-read what I wrote. I’m pretty sure you misunderstood it.

  • Mirad77

    Do nothing congress has something to say cuz it’s made by Chinese? What isn’t made in China? The Chinese gov’t could as well have someone in foxconn or any other factories getting info to them of everything that is made in China. Congress should shut the fuck up and pass the jobs bill.

    • TMOTECH

      Nice Mouth. You should read up on something before you make such ignorant statements.

      • Mirad77

        And the genius skill set with which you derived my ignorance on the subject is? To suspect someone without adequate proof is one thing but to do so in line to your lobbyist is whole different matter. I rather you get more info before calling others ignorant.

        • Bklynman

          I agree with you. What about iphone,,ipad? Right China wouldn’t do anything to 2 biggest pieces electronics in the world.How many people in U.S. govt has one? In case no one has notice this most of Old Glory now made in China!

    • BigMixxx

      Outside of the potty mouth (Here we go with the Young money References Tyga — Potty Mouth)

      I could almost see your point. But to openly and wilfully call out two companies – there has to be more to it than just phones and tablets…since network equipment is called out here, why not go to an extreme and point finger at those that copied catapillars’s designs, etc, etc, etc…. To call out THESE two. why?

      Sprint has a LOT of government deals on the table. I think that’s where a lot of this comes from….

      • Mirad77

        Big there’s been reporting on this as far back as 3-4 months. Just look at where am coming from, after this was out the first person is Cisco saying they will cut further deals with both guys. This just so happens as Cisco eats the giant piece of pie when it comes to networking contract. The real concern here is 80% network equipment than phones and tablets. Nokia, Siemens, alcatel, Ericson are all players in the network game as those two and none of them is American.
        Isn’t this same Congress saying net neutrality is not good for consumers? Lobbyist are the ones playing this game . No matter what kind of equipment you use, if you don’t secure your network then you are at fault.

  • http://www.facebook.com/Jeffj1976 Jeffrey W Jones

    I pity the poor fools who actually got one of these pos from tmobile. Stupid. But, the question is, who is more foolish and stupid-the people who bought these or tmobile for selling them. I think the latter. I’d like to know how well the prism, and my touch sold. Both by Huawei.

    • JBrowne1012

      You do realize the latest mytouch is made by huawei right? and its not that bad of a device actually, its very nice.

      • http://www.facebook.com/Jeffj1976 Jeffrey W Jones

        No. It’s not a nice device. Plain and simple. I saw it. It sucks. Nuff said.

        • JBrowne1012

          Oh you saw it? hmm seeing and testing is 2 different things.

        • http://www.facebook.com/Jeffj1976 Jeffrey W Jones

          So you were stupid enough to buy it? Hell, it shipped with gingerbread, and that is inexcusable. I pity you if you actually bought that pos. And I don’t need to test it to know it’s a pos. Samsung FTW.

        • JBrowne1012

          What is really inexcusable is your ignorance. No I did not buy it, I already have a phone, a HTC Sensation running a CR and am waiting to hear what the next Nexus will be before considering buying a G Note 2, I’ll prolly get a G Note 2 on contract and buy the Nexus outright. Aside from that not needing to test it to know its a POS? then thats just blatant fanboyism and hatred. I hope you test your devices before buying them, its very foolish if you don’t otherwise you are no better than an Apple iPhone Fanboy.

      • theking_13

        Its nice, if you can’t afford anything else. I stick to HTC and Samsung, quality companies. Hell, even LG manages to pull a nice phone every once in a while.

        • JBrowne1012

          Yes if you can’t afford anything else, its not something i would get locked for 2 years over but its still nice.

        • theking_13

          Yup, like a backup phone in case you break in your main one. Or to give to my little brother.

  • moises1204

    yea the us government will never spy on the us.!!

  • http://www.facebook.com/h3ktyk88 Selim Jamil Savany

    dont matter to me, zte and huahauawhwhwweii can both die and I will never even notice it.

  • JBrowne1012

    I’m not fully understanding the issue here… So a device is released influenced by the chinese government… How does this possibly affect my safety? privacy? or so on? What really is it that I should be worried about?

    • theking_13

      They can see everything you do and send, that’s how.

      Your question is really ignorant, either you’re really naive, or have no idea how electronics work.

    • F800

      The greater concern is their infrastructure equipment (“towers”)

    • rtechie

      There’s credible evidence that Huawei has built backdoors in their network equipment for the Chinese government. They’re denying this, but then they denied stealing code from Cisco too. They also won’t submit to an independent code review.

  • custom1

    The threat is considered over. The last two remaining Huawei and ZTE phones have been tracked and confiscated by the combined teams of the FBI and HLS. Each owner has been given a far superior restroom vending machine phone as a replacement.

  • Village Idiot

    LOL! Really? “All your phones are belong to us!”