Network World - U.S. IT security vendors surveyed about the Congressional report this week that blasted China's Huawei and ZTE as threats to U.S. national security say that the companies shouldn't be ruled out as network equipment suppliers but that they need to be more transparent about their dealings with the Chinese government.
The central argument made in the "Investigative Report on the U.S. National Security Issues Posed by Chinese Telecommunications Companies Huawei and ZTE" from the U.S. House Intelligence Committee is that both companies have close but murky ties to the Chinese Communist Party and military, with Huawei in particular being evasive about these connections. The report claims there's a danger that if their network equipment becomes widely used here, they could "provide Chinese intelligence services access to telecommunications networks."
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Philippe Courtot, CEO of vulnerability-assessment scanning services company Qualys, says he doesn't know if the Chinese government is involved in such activities with these companies. But Huawei, which is known to be exploring the possibility of an IPO, should move forcibly to distance itself from any connection to the Chinese government, he says.
Though he says having a Congressional report label you a threat to national security could push the company out of the U.S. market, it's still possible for Huawei to respond in a way to build confidence.
"It's an opportunity to become transparent," Courtot says. "They need to disconnect themselves from the Chinese government" and try to clear the air regarding the accusations.
Huawei today said it is in no way cooperating with cyberspying by the Chinese government.
"We absolutely unequivocally reject any such notion. Indeed, it is complete and utter nonsense. We're a world-respected and trusted $32 billion company doing business in 150 markets - we would not jeopardize our commercial success for any government," said Bill Plummer, vice president of external affairs.
Courtot argues that if Huawei cannot show transparency and independence from the Chinese Communist government in its business affairs, it may slow down the Chinese telecom company's growth. But he predicted the likely outcome from this week's Congressional report might be to slow down its sales in the U.S. but not in the rest of the world.
The House report about the two Chinese telecom companies "is raising some valid concerns," says Jagdish Rebello, director for consumer and communications at research firm IHS. He says there is significant opportunity to plant hidden code in a system.
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