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Jun 3, 2016

Bits | The Business of Technology - June 3, 2016: Huawei Draws Attention of U.S. Regulators.

Friday, June 3, 2016

The New York Times


The New York Times

Friday, June 3, 2016

Daily Report
Huawei Draws Attention of U.S. Regulators | One of China’s biggest threats to an American technology leader just found life a lot tougher.
Huawei Technologies, which over the last decade has become a leading global supplier of internet and communications gear, has been subpoenaed by the United States Commerce Department to turn over information about its sales to Cuba, Iran, North Korea, Sudan and Syria, Paul Mozur writes.
These countries are, in American eyes, outlaw states or places where the United States restricts exports of American gear, and the subpoena was issued at Huawei’s headquarters in Texas. It deals with exports of United States gear, which could mean things that Huawei made even in part in the United States.
It couldn’t come at a worse time for Huawei. The Chinese company has 170,000 employees and annual sales of $60 billion, an increase of 50 percent in the last three years. Almost none of that comes from the American market, where Cisco Systems dominates sales of the computer switches and internet routers both companies sell.
A congressional panel in 2012 named Huawei, along with another Chinese company called ZTE, a security threat, largely curbing its sales in the United States.
Huawei has worked hard to be a good citizen since then, boasting about its business practices and respect for intellectual property. Last week, it took the extraordinary step of suing Samsung of China for stealing Huawei’s inventions in wireless technology.
That amounted to a coming-out party for the company as a normal international technology player. Now the attention will turn to the Chinese habit of selling things to the enemies of the United States.
More broadly, it is another example of the ways that governments appear increasingly willing to rein in tech companies, something Farhad Manjoo wrote about earlier this week.
The borderless world, it turns out, still has some very powerful guard posts.
— Quentin Hardy
 
Huawei, a major supplier of telecommunications equipment, reported revenue of about $60 billion in 2014.
U.S. Subpoenas Huawei Over Its Dealings in Iran and North Korea
By PAUL MOZUR
Officials are questioning the Chinese telecom giant’s exports to countries covered by sanctions, amid a broader debate over global communications.

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