Spooked spooks made Symantec end Huawei fling - new claim

Affair thwarted info sharing with US spies


Security biz Symantec called time on a joint venture with Chinese telecoms equipment goliath Huawei because it feared the tie-up would prevent it from gaining access to classified US intelligence on cyber-threats, according to a new report.

The New York Times cited “two people briefed on the deal” as saying Symantec’s withdrawal was an attempt to allay any US concerns over its links to the Chinese tech giant at a time when the American government is looking to share more information on threats with the private sector.

If true, the report would seem to fly in the face of the well-rehearsed media line the two firms have been spinning since the end of the partnership was announced in November.

At the time, Symantec CEO Enrique Salem said the four-year Hong Kong-based venture had achieved all of its aims and that the security company would exit having made a good return on investment.

"Four years ago we established the Huawei Symantec joint venture for three specific reasons," he said on a conference call announcing the news.

"First, to gain experience in building and selling appliances. Second, to increase penetration in the China market, and third, to move closer to the networking side of the telecoms segment. I'm pleased to say that we've achieved all of our objectives and believe this is the right time to sell our stake in the joint venture."

Huawei has been dogged by speculation that it represents a risk to US national security – scuppering bids for network infrastructure firm 3Com, server tech biz 3Leaf and a deal to supply mobile telecom equipment to Sprint Nextel.

The rumours surround its links to the People’s Liberation Army (PLA), specifically its founder and CEO Ren Zhengfei who served in the PLA but, as Huawei is at pains to point out, had no military rank.

However, this month a US defence contractor Northrop Grumman claimed that Huawei functions as an “advanced source of technology” for the Chinese military. It continued that joint ventures between Western and Chinese firms could lead to intellectual properpty theft and the long-term erosion of competitiveness for the former.

Huawei hit back at the security company's allegations by saying that “no one has ever offered any evidence that Huawei has been involved in any military technologies at any time”.

The manufacturer has sought to build closer ties with US industry, ploughing $6bn into the faltering economy last month in the form of contracts with OEMs Qualcomm, Broadcom and Avago in California.

That hasn’t helped the firm in Australia: it emerged this week that similar security concerns were behind Huawei being asked to not bid for the National Broadband Network project there.

Symantec declined to comment on the NYT story while Huawei had not responded at the time of publishing. ®

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