I’ve previously mentioned the company Huawei, so thought I’d explain a little more about them and why they have the world worried.
Huawei (pronounced Waa Waay) is a huge Chinese multinational telecoms business. It has been in the news recently because countries around the world are banning the use of its products. Additionally, the Chief Financial Officer (CFO) of Huawei was recently arrested in Canada, pending extradition to the USA.
So why are they so controversial?
The business was founded in 1987 by Ren Zhengfei a former officer in the Chinese People’s Liberation Army. It’s now a huge business with a $100 billion per year revenue! It’s this close tie to Chinese government that has other countries worried.
Huawei designs and manufactures telecoms and networking equipment that powers cellular networks. These cellular networks are now essential to the day-to-day operation of a country. And this is becoming even more important with the development of 5G networks. These new networks are designed to connect all kinds of devices, from cell phones, computers, self-driving cars, even refrigerators. Now imagine another nation state having control of all of this. In the event of war, the control over such an extensive network of devices could be critical. They could pretty much shut a country down.
This is all based on the assumption that the Chinese government have what’s called a “back-door” into the equipment. A back door is a hidden, unknown way into the network that can’t be protected. Modern cellular networks have millions of lines of code, which can be updated on a regular basis to fix problems. Trying to trace back doors in such equipment is nigh on impossible, leading to a level of trust with a provider that the network is secure.
But can Huawei be trusted? Here lies the problem.
After the September 11 attacks on the US, the United Nations Security Council voted 13-0 in favour of an embargo on arms sales to the Taliban until Bin Laden’s training camps were closed and he was extradited to stand trial for the attacks. China abstained from this vote. In fact, months later, Beijing held secret talks with the Taliban which led to a signed contract for Huawei to build a military communications network to cover Afghanistan.
Now, as mentioned above, the CFO of Huawei, Meng Wanzhou (who happens to be the daughter of the founder of Huawei), was recently arrested in Canada for extradition to the USA. The reason – she was allegedly behind suspected front companies in Iran – set up to skirt around international sanctions imposed on Iran.
US Authorities have said that Skycom, an Iranian business was in fact a shell company controlled by Huawei. Similarly, Reuters recently reported that Huawei conducted operations in Syria through a shell company called Canicula Holdings.
All this has led to countries around the world investigating the use of Huawei equipment in their networks. The US has outright banned the use of their equipment and is advising other countries to follow suit. This is a difficult decision as Huawei’s equipment is both technologically advanced, and at a good price. There isn’t much in the way of competition – especially when it comes to 5G. And their recent foldable phone announcement goes to show they’re ahead of the market with quality products.
But can they be trusted? Canada is still undecided. If they ban the use of their 5G equipment, it could significantly increase the cost of 5G roll out. Another consideration is the fact that Canada is part of the 5 eyes network. This is a network of surveillance organisations from Australia, Canada, New Zealand, the UK and the USA. The five countries share information gathering and crossovers between their networks. A vulnerability in Canada’s network could lead to flaws in the other four networks. For this reason, the US is applying pressure to the other 4 countries to also ban Huawei from their networks.
It all goes to show just how reliant we are on cellular networks. I’m sure the majority of Huawei is open and honest, but you have to wonder who’s pulling the strings behind the scenes, and just what they’re capable of!