German is expected to snub US pressure to cut Huawei out of its next-generation 5G networks, rejecting claims that the Chinese manufacturer is a security risk.
According to German media reports, a weekend meeting of the German cabinet dug into the issue and effectively rejected America efforts to impose a global ban on the company. The meeting considered a report by its own security services that said it has failed to find any evidence of spying.
That report reflects a early indication by UK security services that they have been unable to find any evidence that Huawei is installing backdoors in its products, something that is credible given that GCHQ has access to Huawei's source code. A final report is expected this spring.
Coinciding with the German crunch talks, Huawei's previously quiet management has been giving pointed interviews with German and British news publications to push their case.
The company's founder Ren Zhengfei – whose daughter was arrested in Canada earlier this year at the request of American authorities – told the BBC that there was "no way the US can crush" the company, and complained that his daughter's arrest was political.
Meanwhile, the head of Huawei's German arm, Dennis Zuo, spoke to Handelsblatt and actively rejected claims of espionage. "The security of networks is our top priority," Zuo said, stating that the Chinese government "does not hold a stake in Huawei" and stays out of its factories. He said the company will be open and transparent when it comes to mobile network security.
Although the German government meeting ultimately decided to take a diplomatic approach – neither rejecting nor approving Huawei – a clear indication that they are skeptical of American security claims came when German Data Protection Commissioner Ulrich Kelber pointedly noted in an interview with Handelsblatt that "the US itself once made sure that backdoor doors were built into Cisco hardware."
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Kelber added that he found it "very interesting, that just the Americans warn against Huawei." The German foreign office is reportedly more convinced than other departments that Huawei presents a possible security threat. Earlier this month, German Chancellor Angela Merkel took a middle line on the issue, refusing to say she would ban Huawei but noting that it would not be acceptable for the company to share data with the Chinese government.
The anti-Huawei rhetoric emanating from Washington DC, which has been unquestioningly accepted within the United States, has been raising eyebrows for nearly a year.
American telcos have aggressively pushed the questionable concept of a "race to 5G" and persuaded lawmakers of its importance by using fear of Chinese dominance as a counterpoint. Currently American and European companies dominate the mobile market and possess most of the patents on emerging 5G technology but China has been making significant headway and some fear that as the 5G standard is further developed, Chinese companies will overtake US corporations and so reap the next-generation windfall.
At stake are billions of dollars and a controlling stake in the mobile networks' future. But rather than focus all their efforts on out-innovating Chinese firms, significant energy by US companies has been put into scaremongering, painting Chinese companies and particularly Huawei as a security risk.
Also at play is the fact that Huawei is able to make and sell its equivalent products for significantly less than American rivals thanks to lower labor costs.
As security claims have been dug into and no evidence has emerged, however, the American argument has fallen back on a 2017 law passed by the Chinese government that requires all Chinese companies to cooperate with its intelligence services if requested.
The Trump Administrations has seized on that law – despite the United States having similar arrangements with many technology companies – with numerous officials and most recently vice president Mike Pence explicitly warning European countries that allowing Huawei into their networks is to grant an open door to the Chinese government.
The rhetoric has got so blatant a Chinese foreign ministry spokesperson used concerns over President Trump's use of an insecure personal mobile phone to make calls to cheekily argue that if the US government is "really very worried about Apple phones being bugged, then they can change to using Huawei."
There is, of course, a risk with Huawei. As there is with American equipment. And Europeans are caught in the middle wishing to upset neither party, both of whom are important trade partners.
The solution that appears to be emerging in both the UK and Germany is one of cautious diversity, where special attention is given to the most important networks that require high levels of security and some degree of "technological autonomy" is introduced to the system to stop the country from becoming overly reliant on any particular company, American or Chinese. Japan has already rejected US calls for a Huawei ban.
There are several European companies that can also provide 5G equipment and European governments are likely to be more comfortable having one of them build out the most sensitive networks.
The irony of course is that fears of undetectable state-sponsored spying across a network are credible only because the United States government managed to achieve exactly that through its National Security Agency (NSA).
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In 2014, leaked NSA documents revealed, among many other things, that the American spy agency straight up intercepted and bugged Cisco gear on its way to buyers, to spy on network traffic. The snoops also exploited remotely accessible vulnerabilities in Cisco firewalls, and used a combination of secret laws and clandestine operations to tap into internet and mobile networks across the globe. Oh, and President Obama was forced to personally assure Chancellor Merkel that the NSA was not tapping her mobile phone, using language that appeared to confirm that it had been doing exactly that for years.
Since the NSA did that to homegrown American tech giant Cisco, no wonder Uncle Sam is paranoid about China's spies and Huawei.
Although Germany would rather stay out the argument by refusing to take a step in one direction or another with regards to the Chinese tech goliath, the Euro nation is going to hit a difficult deadline next month when it is due to open up auctions for 5G airspace.
If it is going to block Huawei in its networks, Germany would likely need to announce such a move before the auction begins in order to remove uncertainty for bidders. If it doesn't say anything, it will be taken as an implicit acknowledgement that Huawei equipment will be accepted in German 5G networks. ®