Huawei’s global PR team certainly had a frenetic start to December, with three major setbacks coming over just a few days.
First there were reports BT’s mobile unit plans to remove Huawei gear from its 4G core network, then the vendor’s CFO was held in Canada on alleged trade sanction violations and the next week all of Japan’s mobile players said they don’t plan to use the vendor’s 5G kit.
Instead of waiting for the furore to subside over the upcoming holidays and ease into the new year, the Shenzhen-based company called a press conference with its rotating chairman Ken Hu (pictured) and gave media their first glimpse of its Structural Material and Mechanics Lab, which focuses on heat dissipation and anti-corrosion technologies.
While the R&D centre visit was mostly for show (highlighting various innovations), the two-hour Q&A with the chief was indeed substantial. (In an unusual move it also released the full transcript of the event the next day.)
Hu didn’t shy away from the hard questions. He started by stating security concerns are disingenuously raised as excuses to block market competition and insisted labelling the company as a security risk should be based on real evidence, which needs to be shared with operators, Huawei or the public.
Responding to a question about fears it could spy on behalf of the Chinese government, he said the Ministry of Foreign Affairs recently formally clarified that no law requires domestic companies to install mandatory backdoors.
“Just like the US and Australia, China also has certain legal requirements for counter terrorism or cyber security objectives,” he explained.
Focus on positives
Despite recent setbacks, Hu highlighted the positives: “We don’t see operators saying they want to swap out Huawei equipment. On the contrary, out of the hundreds of operators we work with in the world, almost all of them are saying they want to work with Huawei…because they know we are the best. Only by using the best equipment can they build up their 5G networks faster and can they build up their 5G networks in a more cost-competitive way.”
He also emphasised the disadvantages operators face when not allowed to use its gear, noting bans would slow adoption of new technology, increase costs for network deployments and raise prices for consumers.
“If Huawei could compete in the US for 5G deployment from 2017 to 2020, some $20 billion of capital expenditure in wireless infrastructure would be saved, according to some economists,” he declared.
The point is that Huawei, which expects revenue to top $100 billion this year and already claims 25 5G commercial contracts, is not backing down from the fight and intends to proactively address the security concerns raised by the US and many of its allies, which is the reason behind the equipment bans in a growing number of markets.
Its recent ‘openness’ is in stark contrast to its earlier PR strategies.
A Hong Kong-based PR executive, who asked not to be identified, told Mobile World Live that the company, rather than taking defensive or retaliatory action, has done everything possible to openly acknowledge the issues it faces and address them with media, industry and authorities.
The executive added: “This front-foot positive engagement is a notable shift from many Asian and Chinese companies that typically batten down the hatches and withdraw from all engagement. Huawei is to be commended for its response given the dire situation it faces.”
As The Economist noted in this week’s edition, it is impossible for Huawei to prove a negative, for example, that it is not spying. It all comes down to its reputation and trust from its clients, third-party agencies and governments.
Addressing the spreading concerns will be the company’s biggest challenge over the next year or so: talking up its successes and sharing plans to mitigate risks and soothe worries is a good place to start.
The editorial views expressed in this article are solely those of the author and will not necessarily reflect the views of the GSMA, its Members or Associate Members.Subscribe to our daily newsletter