AT&T CEO Says China’s Huawei Hinders Carriers From Shifting Suppliers for 5G

By Reuters
March 21, 2019 Updated: March 21, 2019

WASHINGTON—AT&T Inc Chief Executive Randall Stephenson said on March 20 that China’s Huawei Technologies is making it very difficult for European carriers to drop the company from its supply chain for next-generation 5G wireless service.

“If you have deployed Huawei as your 4G network, Huawei is not allowing interoperability to 5G—meaning if you are 4G, you are stuck with Huawei for 5G,” said Stephenson at a speech in Washington. “When the Europeans say we got a problem—that’s their problem. They really don’t have an option to go to somebody else.”

The United States has been pressuring other countries to drop Huawei from their networks. Stephenson said the U.S. government could do a better job explaining the security risks of Huawei. “The biggest risk is not that the Chinese government might listen in on our conversations or mine our data if we use their equipment,” Stephenson said.

Within a decade, 5G will drive all U.S. factories, utilities, refineries, traffic management and help underpin autonomous vehicles. “If that much of infrastructure will be attached to this kind of technology, do we want to be cautious about who is the underlying company behind that technology? We damn well better be,” Stephenson said.

Huawei did not respond to a request for comment March 20.

The United States warns that next-generation 5G equipment, which some telecom experts see as more vulnerable to attack than previous technology, could be exploited by the Chinese regime for spying if supplied by Huawei.

Huawei has grown rapidly to become the world’s biggest maker of telecom equipment and is embedded in the mobile networks and 5G plans of many European operators. It denies that its technology represents a security risk.

In the United States, 5G networks will largely be built by Nordic equipment makers Ericsson and Nokia, and Strayer said there were safer alternatives to Huawei.

The United States has also alleged Huawei violated its sanctions on Iran and stole intellectual property. Several Western countries have restricted the firm’s access to their markets.

Chancellor Angela Merkel said on Tuesday Germany was not planning to exclude any one company from its 5G auction per se, but rather wanted bidders in the mobile spectrum auction to meet certain requirements.

Huawei Background

Huawei’s chief financial officer, Meng Wanzhou, was arrested by Canadian authorities at an airport in Vancouver in December 2018 on behalf of the United States, which seeks to prosecute her on charges related to fraud.

In a 13-count indictment, U.S. attorneys accuse Meng, Huawei, and several of the company’s subsidiaries of violating sanctions against Iran. Meng herself is charged with bank fraud, wire fraud, and conspiracy to commit bank and wire fraud.

Meng Wanzhou
Huawei’s Financial Chief Meng Wanzhou arrives at the B.C. Supreme Court in Vancouver, Canada on March 6, 2019. (Ben Nelms/Reuters)

Meng will remain on bail, subject to her existing conditions while court proceedings are underway. Canadian authorities set the next hearing for May 8, which is when the court will hear an outline of how the extradition proceedings will move forward.

In a separate 10-count indictment, U.S. prosecutors accuse Huawei of stealing trade secrets, committing wire fraud, laundering money, and obstructing justice. In the indictment, prosecutors allege that Huawei managers encouraged stealing competitors’ technology, including the designs of a T-Mobile robot named “Tappy.”

Speaking at a press conference where the charges against Huawei and Meng were unsealed, U.S. Commerce Secretary Wilbur Ross said the Trump administration is taking a tougher stance against those who violate trade sanctions.

“For years, Chinese firms have broken our export laws and undermined sanctions, often using U.S. financial systems to facilitate their illegal activities,” Ross said. “This will end.”

By David Shepardson. Epoch Times reporter Margaret Wollensak contributed to this report.