Scrolling past the umpteenth Huawei internship on WaterlooWorks, it is easy to believe that all is well with the company. A peek out from under the rock, however, reveals a litany of dire predictions and doomsday cries.
The Chinese tech giant is, presently, living through decidedly interesting times. A year ago, Huawei executive- and daughter of Huawei’s founder- Meng Wanzhou was arrested in Vancouver, by Canadian authorities acting on American request. She is alleged to have fraudulently obtained money from American banks on behalf of Sky-com, a Huawei controlled company which violates American sanctions on Iran. This arrest, as Prime Minister Trudeau painstakingly enunciated, was a matter of following the rule of law, quite detached from any political maneuvering- a wise enough pronunciation which was immediately scuppered when President Trump tweeted veiled offers to drop charges against Mrs. Meng in exchange for a more favourable trade deal.
Presently, the Presidential powers have once more been flexed and Huawei is now blacklisted, banned from using any American made software or hardware- including Android. According to a statement by Huawei CEO Ren Zhengfei, the company has long since suspected that something was afoot and prepared for the moment accordingly. A Huawei OS, called “Hongmeng”, is in the works and is slated for domestic roll out in fall of 2019.
Nevertheless, the blacklist would severely impact Huawei in the international market. Customers are liable to shy away from phones which lack the familiar An-droid apps which have today become ubiquitous- including Gmail, Google Maps, and Youtube.
The last time a Western country made a move against Huawei, a host of random expatriates were arrested in retaliation on trumped on charges of espionage. This time, however, the Chinese government might decide to respond with slightly more grace.
In a fit of chivalry, Ren Zhengfei told the media that he would oppose any retaliatory measures against Apple, which could see as much as a 29% hit should China embargo its products. It seems dubious whether he would make such declarations at all, without the approval of the Chinese government- so America’s tech darlings are, for the moment, probably safe.
This ban follows intermittent debate about the potential security threat posed by Huawei and other Chinese telecommunications companies. Politicians and journalists have routinely called for Huawei to be banned from the 5G network, on the basis that any major Chinese company is apt to act as the intelligence arm of the Chinese Communist Party.
Now, Trump has certainly impaired, if not scuppered, Huawei’s 5G aspirations; several British mobile carriers have booted Huawei from the planned 5G roll out and a British chip company has pulled its silicon technology from Huawei.
Like most of the attacks in this trade war, the ban is a double edged sword; Huawei’s technology is now so ubiquitous in the United States that a ban could leave rural communities without service. Seven hundred million has been allocated by the American Senate to replace Huawei technology, but this has prompted the typical complaints about inadequacy.
Immediately after issuing the ban, President Trump suspended it for ninety days, allowing the by now thoroughly beleaguered tech giant a modicum of breathing room. It would not be terribly surprising if he were to renew the suspension, or withdraw the ban altogether, as the political winds shift. Trump has previously lifted penalties on another Chinese tech company, ZTE, and has lately made some noise about including Huawei as part of a trade deal. For the moment at least, he has made the panoply of WaterlooWorks jobs at least a modicum less tempting.