Spiegel Online
Almost a third of the planet is thought to be using its products and yet few know much about the highly secretive Chinese telecommunication equipment company Huawei. Should customers be concerned about the company founder’s military background or the security vulnerabilities of its products?
The first problem is just saying the company’s name. Huawei is pronounced wah-way. It means something like “China acts!”
The second problem is its patriotic swagger. The telecommunications networking equipment and mobile phone supplier, based in the southeastern Chinese city of Shenzhen, is accused of secretly spreading high-tech spying devices around the world, having close ties with the Chinese military and supplying products to pariah states like Iran. A recent report by the Intelligence Committee of the United States House of Representatives warned against using the company’s products for critical telecommunications infrastructure. The Australian government has also blocked the company from bidding for contracts related to the construction of its national broadband network.
It would appear that Huawei cannot be stopped, though. At the international consumer electronics show opening in Las Vegas on January 8, the company will present the first mobile phone that uses the Windows Phone 8 operating system as well as a massive, souped-up mobile phone with a six-inch-plus display screen that puts it in the category of phone-tablet hybrids known as “phablets.”
In July, the company already introduced its “Ascend P1,” a respectable Android-based smartphone that is thinner than many rival products and boasts better battery life than the iPhone 5.
The Chinese company has its sites set on being able to make better smartphones than both Samsung and Apple soon. Though this might sound overly ambitious, Huawei means business. Some estimates hold that roughly a third of the world’s population already uses the company’s technologies in some way, often without being aware of it. Many Internet connections run through servers made by Huawei, and many mobile-phone calls are transmitted through the company’s base stations. In Germany, the first “surf sticks” using the ultra-fast LTE standard that were marketed by Deutsche Telekom, the country’s telecommunications giant, were built by Huawei.
A Charm Offensive
But in contrast to Foxconn, the campus-like grounds of Huawei’s headquarters are devoted to developing rather than assembling products. The conference rooms are elegantly furnished, the espresso bars are first-rate, and the subtropical indoor plants are draped with glittering Christmas decorations. It might be winter outside, but there’s a steamy warmth in the restaurants and among the palm trees inside. The gigantic campus is home to some 40,000 engineers, whose average age is 29, and most live in dormitory-like housing.
Huawei has some 150,000 employees in more than 140 countries, including over 1,600 in Germany. Despite its global presence, however, the company is decidedly Chinese. It was founded in 1987 by Ren Zhengfei, a former technology officer in the People’s Liberation Army.
Huawei expanded abroad after the turn of the millennium. Since then, it has grown to become the world’s second-largest supplier of telecommunications networking equipment, with annual sales of some €25 billion ($33 billion). Soon, it might even surpass the market leader, Sweden’s Ericsson. What’s more, rather than making low-cost knockoffs, Huawei channels over 11 percent of revenues back into research and development, and already holds more than 20,000 patents.
Security Issues
Two years ago, the company took a bold and radical step aimed at eliminating suspicions about its possible involvement in espionage. It set up the Cyber Security Evaluation Centre, a kind of quarantine station, in the small British city of Banbury, not far from Oxford. There, 20 employees look for security vulnerabilities in Huawei devices alongside counterparts from the Government Communications Headquarters (GSHQ), the British intelligence agency responsible for electronic intelligence gathering and cyber security. The company reportedly even gives the GSHQ access to its product source code, the holiest asset of any high-tech company.
The center is meant to banish all worries about the secretive company and its founder’s military past, but not everyone is convinced. “That is probably supposed to sound reassuring,” says Felix Linder, who dresses in black and goes by the name “FX” in industry circles. “But what good does it do German companies if the British intelligence service knows about Huawei’s security vulnerabilities?” Linder is the head of Recurity Labs, a 10-person IT security firm based in Berlin’s Kreuzberg district. “Intelligence agencies love security gaps,” he adds, “just in case they need access at some point themselves.”
Spiegel has the full article
