FBI director Christopher Wray announced earlier this week that he is “deeply concerned” about the threat that two Chinese mobile phone and telecommunication equipment manufacturers, Huawei and ZTE, pose to the United States.
The Senate Intelligence Committee held a hearing on global terror threats, where they discussed issues like nuclear security, cyber threats, transnational gangs, and Russian efforts to influence U.S. elections, including the ongoing investigations about those efforts.
At the hearing, when asked about customers using Huawei and ZTE products, the FBI director said:
“We’re deeply concerned about the risks of allowing a company or entity that is beholden to foreign governments that don’t share our values to gain positions of power inside our telecommunications networks, that provides the capacity to exert pressure or control over our telecommunications infrastructure, it provides the capacity to maliciously modify or steals information and provides the capacity to conduct undetected espionage.”
Both AT&T and Verizon were pressured by US government to avoid offering Huawei and ZTE for sale as part of their contract deals. This was a huge blow for Huawei as it now means they won’t be able to successfully make a dent in the US market, as they did in Europe and Asia.
If Huawei had any real chance of competing with brands like Samsung, they would have needed to partner with various US telecoms, as 90% of the handsets are sold via carriers.
Huawei lashed back, saying that the director should be more ‘cautious’ when accusing particular companies of being more vulnerable than the other.
“Huawei is trusted by governments and customers in 170 countries worldwide, connecting one-third of the world’s population,” said Huawei Vice President of External Affairs William Plummer. “Privacy and security are critically important to all of us these days and we must all be cautious to protect our personal and family and professional data from compromise.”
“In a world in which every information technology solution is the product of global supply chains, authorities should also be cautious not to brand one or another supplier as ‘more vulnerable’ than others – this is misleading at best, dangerous at worst.”
Even though there has been no real public evidence to support to FBI’s safety concerns, both Huawei and ZTE will have to look elsewhere if they want to have any hopes of beating out Samsung.