Huawei, Rep. Wolf and George Clooney

Representative Wolf (R-VA) has some strong concerns about China, many of which may well have merit.   Sadly, Rep. Wolf's expressions of concern about China, however well-justified, sacrifice credibility when he kowtows to industry friends who seemingly seek to leverage the Congressman's China concerns to preclude competition and innovation in the U.S. information and communications technology industry.

Recently, as reported by The National Journal (link) and others, Rep. Wolf wrote to a Managing Partner at a D.C. law firm calling on that Partner to drop representation of China-based multinational Huawei, my employer (Please note that the comments in this blog are my personal reflections).

Rep. Wolf's letter rehashes oft-cited, never-substantiated disinformation about Huawei, including purported ties to the Chinese Government, as justification for his request of the law firm.  He further cites as some sort of factual basis for his opinion an April 6, 2012 Wall Street Journal article that quoted Cisco CEO John Chambers saying that Huawei is Cisco's "toughest rival" and that Huawei doesn't always "play by the rules."

Among multiple ironies associated with Rep. Wolf's seeming support for Cisco's commercial de-positioning campaign, is the fact that Cisco conducts significant research and development, codes software, builds products and invests billions of dollars annually in China, Chinese-based innovation, and Chinese education and jobs.

There has never been a shred of proof of Huawei having any undue connection to the Chinese Government.  Notably, Huawei, which bears some responsibility for having allowed disinformation to fester for the better part of a decade, has since its February 2011 "Open Letter" (link) continually and proactively communicated detailed facts about the company, and has consistently been met with nothing more than unsubstantiated politically- or competitively-inspired myth and innuendo.

But this isn't Rep. Wolf's first run at the company.  On March 19, 2012, Wolf made remarks for the Congressional Record (link), yet again undermining his concerns about China-based cyber activities by purporting links between Huawei and the Chinese Government (citing numerous never-substantiated sources, U.S. Government and otherwise), and almost amusingly warning that "U.S. network carriers should not be selling Huawei devices...but if they do, they have an obligation to inform their customers of these threats."  Given that virtually every mobile device (and computer, for that matter) is made in China, the carriers are going to have to cede a lot of display space to Rep. Wolf's proposed warning brochures...

Wolf's letter also quotes U.S. Secretary of Commerce John Bryson making fuzzy observations about Huawei, including the quizzical statement: "It appears that Huawei has capabilities that we may not fully detect to divert information."  Sadly, Rep. Wolf's letter is too brief to include yet more "fun with facts" from his exchange with the Secretary that took place during a March 20, 2012 Commerce-State-Justice Appropriations Subcommittee meeting.  So, it seems only fair that we review some highlights (errors are not mine, they come verbatim from the transcript), with comments.  I'll ignore all of the tired references to Huawei's "close connections" to Chinese intelligence, given that they are backed with zero substance and fly in the face of well-publicized facts:

WOLF: "...The Wall Street Journal reported that quote, 'Huawei's network business has stride at the expense of struggling Western network companies such as Alcatel, Lucent Company and the Korea's Siemens networks.'  The bottom line is that these subsidies are costing American jobs and distorting the global market."

Comment: Ok, this one is easy enough... Yes, competition can have an impact on incumbents. But, the incumbents referenced - based in France and Finland/Germany and both with significant operations in China - have been cutting American jobs and investments in the U.S. for years now while Huawei has been adding thousands of jobs, investing hundreds of millions of dollars in U.S. innovation, and procuring billions of dollars worth of goods and services from U.S. based technology companies.

WOLF: "The Chinese government has Catholic bishops on house arrest.  The Chinese government's connection to Huawei, the People's Liberation Army, has Protestant pastors -- house Protestant pastors in jail...  They have a 2010 Nobel Prize winner, Xiabo in jail.  They were not allowed to go to Oslo to pick up the award nor would they let his wife go.  Based on the policies of the Chinese government and the People's Liberation Army in connection to Huawei too, we have to keep in mind all the time."

Comment: Huh?

WOLF: "We cannot disregard the fundamental connection that Huawei's doing and that they're connected within the Chinese government and the activities of the Chinese government and lastly, there was a lot of news last week when George Clooney who was (inaudible) went to Sudan.  I was in Southern Sudan, in that refugee camp in (Nuba).  The Chinese, the People's Liberation Army, connected to Huawei, are putting Chinese rockets that go 100 kilometers that are killing people..."

Comment: WTF?

WOLF: "...I saw that the president met with George Clooney, so there's no breakdown. I think it's important that the White House understand the whole Huawei connection so that this company doesn't hire Washington lawyers and lobbyists and people plugged in to begin to approach the White House to bypass the good work that you're going to be doing with regard to Huawei and go around you by going into the White House because as you can remind the White House, when the president met with George Clooney and that's on this issue.  That has connectivity to the whole Huawei issue."

Comment:  I am speechless...

To the extent that Rep. Wolf's credibility may have been undermined by his curtsy to Cisco, it seems utterly blown away by the flights of fancy featured in his remarks on the record above.  Indeed, one really has to wonder what Secretary Bryson and anyone else in the room must have been thinking as the words spewed forth...

Fairly addressing the "Huawei Challenge"

Huawei Technologies is a world leading information and communications technology solutions provider. Huawei's solutions have been deployed in over 140 countries, by over 500 operators, and are currently connecting around one-third of the world's population to telecommunications and broadband services.

Yet, for purported "national security" reasons, Huawei has been precluded by certain governments in certain instances from competing for certain projects or making select acquisitions, as most-recently highlighted in the context of the Australian National Broadband Network (NBN) roll-out, but more notably in a string of incidents in the U.S. dating back to 2008.

Barring Huawei from projects means less competition, less industry-wide innovation, less choice for telecommunications operators, more expensive networks, and pricier broadband services for consumers.

At the heart of the so-called national security concerns is the fact that Huawei is based in China.

Swirling around this fundamental fact - for the better part of the last decade - have been numerous universally-unsubstantiated allegations, innuendo, myth and untruths about Huawei, often as not encouraged by Huawei's global competitors.

But, the only demonstrable fact - for whatever political or other reasons of some concern - is that Huawei is based in China.

So what about the competition?

Due to the global market-based realities that have evolved over the last 10-15 years, Ericsson, Alcatel-Lucent, Nokia-Siemens, Motorola, Cisco and virtually all other major ICT venders are also heavily investing, conducting research and development, coding software, manufacturing product and supporting tens of thousands of jobs in China.

What is it about Huawei that makes it different? Just the Chinese heritage? After all, no other concern has ever been validated. Ever. Indeed, if all such concerns remain unsubstantiated, then governments are seemingly driving less competition, less innovation, less choice, more expensive networks, and pricier broadband services for their citizens.

That said, given the history (if nothing's been proven over the last ten years it's unlikely to happen now), let's assume that the decade of myth and innuendo will remain nothing more than that and turn our attention to more fully addressing the "Chinese product" concern.

Governments - politicians, policy-makers, regulators, legislators - that are contemplating mechanisms to block so-called Chinese companies from their ICT sectors (or elements thereof) should at the very least conduct such contemplation in the context of a full and public review and understanding of all of the facts and their implications.

How might we achieve this? Simple. If "Chinese product" are a concern, then every ICT vender should publicly disclose and detail and answer questions related to their global operations, worldwide supply chains, operations in China, as well as (while we're at it) their security practices and disciplines.

Notably, half of this information is on the public record (if seemingly unnoticed). Why would anyone object?

Bottom line: National security concerns are real - for any country. Telecommunications network and critical infrastructure protection are vital national and international challenges, as is protecting sensitive government and commercial information. True, honest and effective solutions to meeting these challenges will only be realized with all of the facts on the table.

The facts are that all of these companies are global, rely on the same global supply chains, and the same global ICT supplier and partner ecosystems - they share the same potential vulnerabilities. This is undeniable.

Once the facts are understood, once it is acknowledged that every ICT vender is a globalized company, including with significant R&D, coding and production in China (and in the U.S., for those who might harbor such concerns), then the conversation about "national" security concerns can turn in a more rational, fact-based, global solution-oriented direction.

Why would anyone object?

Full disclosure (in case you hadn't gathered): I work for Huawei.