Archive for ‘smartphone’

25/05/2019

Across China: “Sino-British Street” seeks rejuvenation

SHENZHEN, May 25 (Xinhua) — A southern Chinese trade hub boasting special links with Hong Kong is hoping the enhanced efforts to build the g will revitalize its tourism industry and local economy.

Chung Ying Street, or “Sino-British Street,” straddles the Hong Kong Special Administrative Region and the mainland city of Shenzhen and has been a special zone where local residents from both sides are allowed to cross the border freely.

It was once a boomtown popular among mainland visitors, who entered with a special permit to snatch duty-free goods from Hong Kong, but fell into decline after travel to Hong Kong was made easier for mainlanders.

The street derived from a small village, which was divided by the “Sino-British” borderline after Hong Kong became a British colony in the 19th century.

Sha Jintao, a 73-year-old resident, remembers how the street became a boomtown as China opened up and tightened links between the mainland and Hong Kong.

“When I was a child, there were only a few farmers and fishermen living on the mainland side of the street, while the Hong Kong side bustled with shops and businesses,” Sha said.

But as Shenzhen rose as a forefront of China’s reform and opening up starting in the late 1970s, the street became the center of changes. New shops and factories propped up with the inflow of Hong Kong investments, and the fancy commodities from its Hong Kong stores wooed in large numbers of mainland tourists.

Historical records show the number of tourists flocking into the 250-meter-long street peaked at 100,000 a day in the 1980s. As many as 89 jewelry stores opened in its heyday and sold 5 tonnes of gold jewelry in half a year.

SURVIVAL CRISIS

The heyday was however short-lived. After Hong Kong returned to the motherland in 1997, the street began to lose its appeal, as shopping in Hong Kong was made much easier for mainland tourists. Its daily visitors dropped below 10,000 after 2003, when mainlanders were allowed to independently travel to Hong Kong.

Many stores closed due to a loss of customers, and some survived by selling fake jewelry, winning the street much notoriety, recalled Sha, who then headed the local neighborhood committee.

Sha said the ephemeral boom was limited to the era when most Chinese had limited access to the outside world, so as the country opened its door wider, the street’s function as a “window” faced an inevitable doom.

“Now with a smartphone, a consumer could easily buy goods from across the globe,” he said, referring to China’s cross-border e-commerce boom. “So if is just for the purpose of shopping, why take the trouble of traveling to the Chung Ying Street?”

The street is now more of a cultural site, dotted with relics and museums displaying its history, but locals are hopeful that the ongoing construction of the Guangdong-Hong Kong-Macao Greater Bay Area will usher in another golden era for their neighborhood.

China has planned to turn the greater bay area, which encompasses Hong Kong, Macao and nine cities in Guangdong Province, into the world’s largest bay area in terms of GDP by 2030.

Earlier this month, the city government of Shenzhen said it will upgrade its ports with Hong Kong to boost the greater bay area development. The Shatoujiao Subdistrict, where the Chung Ying Street is located, was reserved for a new cooperation zone featuring tourism and consumption.

Optimism is running high in the community. New industries like artificial intelligence (AI), health and high-end shipping service have taken root in Yantian District, which administers Shatoujiao, and Sha is buzzing around to connect business people from Hong Kong and Shenzhen.

“Shatoujiao and its Chung Ying Street have boasted the one-of-the-kind advantage in Shenzhen-Hong Kong cooperation. We’ll work hard to turn the blueprint of the greater bay area into a reality here,” said Chen Qing, party secretary of Yantian.

Source: Xinhua

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20/05/2019

Huawei’s use of Android restricted by Google

Google has barred the world’s second biggest smartphone maker, Huawei, from some updates to the Android operating system, dealing a blow to the Chinese company.

New designs of Huawei smartphones are set to lose access to some Google apps.

The move comes after the Trump administration added Huawei to a list of companies that American firms cannot trade with unless they have a licence.

Google said it was “complying with the order and reviewing the implications”.

Huawei said it would continue to provide security updates and after sales services to all existing Huawei and Honor smartphone and tablet products covering those have been sold or still in stock globally.

“We will continue to build a safe and sustainable software ecosystem, in order to provide the best experience for all users globally,” it added.

Mobile market shares

What does this mean for Huawei users?

Existing Huawei smartphone users will be able to update apps and push through security fixes, as well as update Google Play services.

But when Google launches the next version of Android later this year, it may not be available on Huawei devices.

Future Huawei devices may no longer have apps such as YouTube and Maps.

Huawei can still use the version of the Android operating system available through an open source licence.

Ben Wood, from the CCS Insight consultancy, said the move by Google would have “big implications for Huawei’s consumer business”.

What can Huawei do about this?

Last Wednesday, the Trump administration added Huawei to its “entity list“, which bans the company from acquiring technology from US firms without government approval.

In his first comments since the firm was placed on the list, Huawei chief executive Ren Zhengfei told Japanese media on Saturday: “We have already been preparing for this.”

He said the firm, which buys about $67bn (£52.6bn) worth of components each year according to the Nikkei business newspaper, would push ahead with developing its own parts.

Huawei faces a growing backlash from Western countries, led by the US, over possible risks posed by using its products in next-generation 5G mobile networks.

Several countries have raised concerns that Huawei equipment could be used by China for surveillance, allegations the company has vehemently denied.

Huawei has said its work does not pose any threats and that it is independent from the Chinese government.

However, some countries have blocked telecoms companies from using Huawei products in 5G mobile networks.

So far the UK has held back from any formal ban.

“Huawei has been working hard on developing its own App Gallery and other software assets in a similar manner to its work on chipset solutions. There is little doubt these efforts are part of its desire to control its own destiny,” said Mr Wood.

Media caption We explain the controversy around Huawei’s 5G tech – using castles

Short-term damage for Huawei?

By Leo Kelion, BBC Technology desk editor

In the short term, this could be very damaging for Huawei in the West.

Smartphone shoppers would not want an Android phone that lacked access to Google’s Play Store, its virtual assistant or security updates, assuming these are among the services that would be pulled.

In the longer term, though, this might give smartphone vendors in general a reason to seriously consider the need for a viable alternative to Google’s operating system, particularly at a time that the search giant is trying to push its own Pixel brand at their expense.

As far as Huawei is concerned, it appears to have prepared for the eventuality of being cut off from American know-how.

Its smartphones are already powered by its own proprietary processors, and earlier this year its consumer devices chief told German newspaper Die Welt that “we have prepared our own operating systems – that’s our plan B”.

Even so, this move could knock its ambition to overtake Samsung and become the bestselling smartphone brand in 2020 seriously off course.


What about the US-China trade war?

The latest move against Huawei marks an escalation in tensions between the firm and the US.

The company is facing almost two dozen criminal charges filed by US authorities. Washington is also seeking the extradition of Huawei executive Meng Wangzou from Canada, where she was arrested in December at the behest of American officials.

It comes as trade tensions between the US and China also appear to be rising.

The world’s two largest economies have been locked in a bruising trade battle for the past year that has seen tariffs imposed on billions of dollars worth of one another’s goods.

Earlier this month, Washington more than doubled tariffs on $200bn of Chinese goods, prompting Beijing to retaliate with its own tariff hikes on US products.

The move surprised some – and rattled global markets – as the situation had seemed to be nearing a conclusion.

The US-China trade war has weighed on the global economy over the past year and created uncertainty for businesses and consumers.

Source: The BBC

06/03/2019

Huawei: The story of a controversial company

The African Union headquarters in Addis Ababa is a shiny spaceship-like structure that glistens in the afternoon sun.

With its accompanying skyscraper, it stands out in the Ethiopian capital.

Greetings in Mandarin welcome visitors as they enter the lifts, and the plastic palm trees bear the logos of the China Development Bank.

African Union HQ, Addis Ababa

African Union HQ, Addis Ababa

 

Everywhere, there are small indications that the building was made possible through Chinese financial aid.

In 2006, Beijing pledged $200m to build the headquarters. Completed in 2012, everything was custom-built by the Chinese – including a state-of-the-art computer system.

For several years, the building stood as a proud testament to ever-closer ties between China and Africa. Trade has rocketed over the past two decades, growing by about 20% a year, according to international consultancy McKinsey. China is Africa’s largest economic partner.

But in January 2018, French newspaper Le Monde Afrique dropped a bombshell.

It reported that the AU’s computer system had been compromised.

The newspaper, citing multiple sources, said that for five years, between the hours of midnight and 0200, data from the AU’s servers was transferred more than 8,000km away – to servers in Shanghai.

This had allegedly continued for 1,825 days in a row.

Le Monde Afrique reported that it had come to light in 2017, when a conscientious scientist working for the AU recorded an unusually high amount of computer activity on its servers during hours when the offices would have been deserted.

It was also reported that microphones and listening devices had been discovered in the walls and desks of the building, following a sweep for bugs.

The reaction was swift.

Both AU and Chinese officials publicly condemned the report as false and sensationalist – an attempt by the Western media to damage relations between a more assertive China and an increasingly independent Africa.

But Le Monde Afrique said that AU officials had privately expressed concerns about just how dependent they were on Chinese aid – and what the consequences of that could be.

In the midst of all of this, one fact remained largely unreported.

The main supplier of information and communication technology systems to the AU headquarters was China’s best-known telecoms equipment company – Huawei.

The company says it had “nothing” to do with any alleged breach.

Huawei “served as the key ICT provider inside the AU’s headquarters”, said Danielle Cave of the Australian Strategic Policy Institute, in a review of the alleged incident.

Huawei headquarters in Shenzhen, China

Huawei headquarters in Shenzhen, China

“This doesn’t mean the company was complicit in any theft of data. But… it’s hard to see how – given Huawei’s role in providing equipment and key ICT services to the AU building and specifically to the AU’s data centre – the company could have remained completely unaware of the apparent theft of large amounts of data, every day, for five years.”

There is no evidence to indicate that Huawei’s telecoms network equipment was ever used by the Chinese government – or anyone else – to gain access to the data of their customers.

Indeed, no-one has ever gone on record to confirm that the AU system was compromised in the first place.

But these reports played into years of suspicions about Huawei – that a large Chinese company might find itself unduly influenced by the Chinese government.

Ren and the rise of Huawei

“When I first started out 30 years ago… we didn’t really have any telephones. The only phones we had were those hand-cranked phones that you see in old World War II films. We were pretty undeveloped then.”

Huawei’s founder and chairman Ren Zhengfei is reminiscing to the BBC about the origins of the world’s second-biggest smartphone firm, while sitting in the Huawei headquarters in Shenzhen – a symbol of the success that he’s worked his whole lifetime for.

A long marbled staircase, covered in plush red carpet, greets you as you first walk in.

At the top of the stairs, a giant painting depicts a traditional Chinese New Year scene.

Inside Huawei's Shenzhen HQ

Inside Huawei’s Shenzhen HQ

A few kilometres away in Dongguan, Huawei’s latest campus is even more eye-catching.

The site – designed to accommodate the company’s 25,000 R&D staff – comprises 12 “villages”, each of which recreates the architecture of a different European city, among them Paris, Bologna and Granada.

It’s as if Silicon Valley had been re-imagined by Walt Disney. Long corridors of Roman pillars and picturesque French cafes adorn the campus, with a train connecting the different areas, running through manicured gardens and past an artificial lake.

It’s a world away from the environment that Mr Ren found himself in when he first started the company in 1987. “I founded Huawei when China began to implement its reform and opening up policy,” he says. “At that time, China was shifting from a planned economy to a market economy. Not only people like myself, but even the most senior government officials, did not have the vaguest idea of what a market economy was. It seemed it was hard to survive.”

Ren was born in 1944 in Southern China – a tumultuous, chaotic place, one of the poorest regions in an already destitute country.

For a long time, hardship was all he ever knew.

He was from a family of seven children. “They were very poor,” says David De Cremer, who has co-written a book on Ren and Huawei.

“I think hardship is something that you can see throughout his life, and which he keeps emphasising himself.”

To escape that life of poverty and drudgery, Ren did what many young Chinese men of that era did. He joined the army.

Soldiers from the People's Liberation Army, 1972

Soldiers from the People’s Liberation Army, 1972

“I was a very low-ranking officer in the People’s Liberation Army,” he says. “I served in an ordinary construction project, not a field unit. At the time, I was a technician of a company in the military, and then I became an engineer.”

He left the military in 1983 when China began to downsize its forces, and went into the electronics business.

By his own admission, he wasn’t a great businessman at first.

“I was someone who had been in the military all my life at the time, used to doing what I was told,” he says. “Suddenly, I began to work in a market economy. I was at a total loss. So I too suffered losses, I too was deceived, and I was cheated.”

But he was quick to learn, and was a keen student of Western business practices and European history.

“I did research on what exactly a market economy was all about,” he says. “I read books on laws, including those about European and US laws. At that time, there were very few books on Chinese laws, and I had to read those on European and US laws.”

Five years later, he founded Huawei – the name can be translated as “splendid achievement” or “China is able” – to sell simple telecoms equipment to the rural Chinese market. Within a few years, Huawei was developing and producing the equipment itself.

Sometime in the early 90s, Huawei won a government contract to provide telecoms equipment for the People’s Liberation Army.

By 1995, the company was generating sales of around US$220,000, mainly from selling to the rural market.

The following year Huawei was given the status of a Chinese “national champion”. In practice, this meant the government closed the market to foreign competition.

At a time when China’s economy was growing by an average of 10% per year, this was no small advantage. But it was only when Huawei started to expand overseas in 2000, that it really saw its sales soar.

In 2002, Huawei made US$552m from its international market sales. By 2005 its international market contracts exceeded its domestic business for the first time.

Ren’s early days in business instilled in him a desire to protect his company from the whims and fancies of the stock market. Huawei is privately held and employee-owned. This gave Ren the power to plough more money back into research and development. Each year, Huawei spends US$20bn on R&D – one of the biggest such budgets in the world.

“Publicly listed companies have to pay a lot of attention to their balance sheets,” he says. “They can’t invest too much, otherwise profits will drop and so will their share prices. At Huawei, we fight for our ideals. We know that if we fertilise our ‘soil’ it will become more bountiful. That’s how we’ve managed to pull ahead and succeed.”

One story from the early days of the company tells how Ren was cooking for his staff (he loves to cook, or so the story goes). Suddenly he rushed out of the kitchen and announced to the room: “Huawei will be a top three player in the global communications market 20 years from now!”

And that’s exactly what happened. In fact, those ambitions were surpassed.

Today, Huawei is the world’s biggest seller of network telecommunications equipment.

From aspiring to be a company like Apple, it now sells more smartphones than Apple.

But shadows have continued to loom over Huawei’s international success.

Ren and Huawei’s links to the Chinese Communist Party have raised suspicions that the company owes its meteoric rise to its powerful political connections in China. The US has accused Huawei of being a tool of the Chinese government.

It’s an accusation which Ren denies. “Please don’t think that Huawei has become what it is today because we have special connections,” he says. “Even 100% state-owned companies have failed. Do good connections mean you will succeed then? Huawei’s success is still very much due to our hard work.”

The case against

It was 1 December 2018. US President Donald Trump and China’s President Xi Jinping were dining on grilled sirloin followed by caramel rolled pancakes at the G20 summit in Buenos Aires.

They had a lot to discuss. The US and China were in the middle of a trade war – imposing tariffs on each other’s goods – and growth forecasts for both countries had recently been cut as a result. This was adding to the fear of a slowing global economy.

In the event, the two leaders agreed a truce in the trade war, with Donald Trump tweeting that “Relations with China have taken a BIG leap forward!”

Xi Jinping and Donald Trump at dinner, December 2018

Xi Jinping and Donald Trump at dinner, December 2018

But thousands of kilometres north in Canada, an arrest was taking place that would throw doubt on this rapprochement.

Meng Wanzhou, Huawei’s chief financial officer and Ren Zhengfei’s eldest daughter, had been detained by Canadian officials while transferring between flights at Vancouver airport.

The arrest had come at the request of the US, who accused her of breaking sanctions against Iran.

“When she was detained, as her father, my heart broke,” says Ren, visibly emotional. “How could I watch my child suffer like this? But what happened, has happened. We can only depend on the law to solve this problem.”

Meng Wanzhou being driven to court in Canada

Meng Wanzhou being driven to court in Canada

Huawei’s problems were just beginning. Nearly two months later, the US Department of Justice filed two indictments against Huawei and Ms Meng.

Under the first indictment, Huawei and Ms Meng were charged with misleading banks and the US government about their business in Iran.

The second indictment – against Huawei – involved criminal charges including obstruction of justice and the attempted theft of trade secrets.

Both Huawei and Ms Meng deny the charges.

January 2019: Acting US attorney general Matthew Whittaker announces charges against Huawei and Meng Wanzhou

January 2019: Acting US attorney general Matthew Whittaker announces charges against Huawei and Meng Wanzhou

The charge of stealing trade secrets centres on a robotic tool – developed by T-Mobile – known as Tappy.

According to legal documents, Huawei had tried to buy Tappy, a device which mimicked human fingers by tapping mobile phone screens rapidly to test responsiveness.

T-Mobile was in partnership with Huawei at the time, but it rebuffed the Chinese firm’s offers, fearing it would use the technology to make phones for T-Mobile’s competitors.

It’s alleged that one of Huawei’s US employees then smuggled Tappy’s robotic arm into his satchel so that he could send its details to colleagues in China.

After the alleged theft was discovered, the Huawei employee claimed that the arm had mistakenly fallen into his bag.

Huawei claimed that the employee had been acting alone, and the case was settled out of court in 2014. But the latest case is built on email trails between managers in China and the company’s US employees, linking Huawei management to the alleged theft.

The indictment also details evidence of a bonus scheme from 2013, offering Huawei employees financial rewards for stealing confidential information from competitors.

Huawei has denied any such scheme exists.

Meng Wanzhou, photographed in 2014

Meng Wanzhou, photographed in 2014

This is not the first time that Huawei has been accused of stealing trade secrets. Over the years companies like Cisco, Nortel and Motorola have all pointed the finger at the Chinese firm.

But US fears about Huawei are about much more than industrial espionage. For more than a decade, the US government has seen the company as little more than an arm of the Chinese Communist Party.

These concerns have been brought to the fore with the advent of “fifth generation” or 5G mobile internet, which promises download speeds 10 or 20 times faster than at present, and much greater connectivity between devices.

As the world’s biggest telecoms infrastructure provider, Huawei is one of the companies best placed to build new 5G networks. But the US has warned its intelligence partners that awarding contracts to Huawei would be tantamount to allowing the Chinese spy on them.

US Secretary of State Mike Pompeo recently cautioned against Huawei, saying, “If a country adopts this and puts it in some of their critical information systems, we won’t be able to share information with them.”

US Secretary of State Mike Pompeo

US Secretary of State Mike Pompeo

The UK, Germany and Canada are reviewing whether Huawei’s products pose a security threat.

Australia went a step further last year, and banned equipment suppliers “likely to be subject to extrajudicial directions from a foreign government”.

Huawei was not mentioned by name, but Danielle Cave of the Australian Strategic Policy Institute says the company posed a national security risk because of its government links.

She cites an article in Chinese law that makes it impossible for any company to refuse to help the Chinese Communist Party in intelligence gathering.

“Admittedly, what is missing from this debate is the smoking gun,” she says.

“For the average person who has a Huawei smartphone it’s not a big deal. But if you’re a Western government that has key national security to protect – why would you allow this access to a company that is in the political system that China is in?”

For his part, Ren says that Huawei’s resources have never and would never be used to spy for the Chinese government.

“The Chinese government has clearly said that it won’t ask companies to install backdoors,” he says. A “backdoor” is a term used to describe a secret entry point in software or a computer system that gives access to the person or entity who installed it to the inner workings of the system.

“Huawei will not do it either,” he continues. “Our sales revenues are now hundreds of billions of dollars. We are not going to risk the disgust of our country and our customers all over the world because of something like that. We will lose all our business. I’m not going to take that risk.”

Xi’s China

Zhou Daiqi is Huawei’s chief ethics and compliance officer.

He’s been with the company for nearly 25 years, in a number of different positions – chief engineer, director of the hardware department, head of the research centre in Xi’an, according to his biography on the company’s website. He is also understood to combine his high-ranking executive duties with another role – party secretary of Huawei’s Communist Party committee.

All companies in China are required by law to have a Communist Party committee.

Zhou Daiqi's profile on Huawei's website

Zhou Daiqi’s profile on Huawei’s website

The official line is that they exist to ensure that employees uphold the country’s moral and social values. Representatives of the committee are also often tasked with helping workers with financial problems.

But critics of China’s one-party system argue that they allow the state to exert control on corporate China. And they say the level of this control has increased in recent years.

“[President] Xi Jinping is exerting greater control over the business community in China,” says Elliott Zaagman, who regularly advises Chinese companies on their PR strategy. “As these companies gain power and influence overseas, the party doesn’t want to lose control over them.”

Ren, however, argues that the role of Huawei’s Communist Party committee is far less important than many in the West believe.

“[It] serves only to educate its employees,” he says. “It is not involved in any business decisions.”

In China, most chief executives are Communist Party members.

Every year, they dutifully turn up to the National People’s Congress along with local and national party chiefs, officials and chief executives.

It’s where the big economic decisions are voted on – although no proposal is put forward which hasn’t already been agreed upon.

Still, big CEOs come to show their commitment to the party, and to contribute to working papers that are meant to help the government understand the concerns of the business community.

Being a member of the party is very much a networking opportunity – in the way one would join a business association.

Elliott Zaagman argues that this is a system that demands loyalty.

“There is no separation from the party and the state,” he says.

“The system in China encourages the lack of transparency in companies like Huawei.”

The worry is that these close links mean that if the Communist Party asked a company to do something, they would have no choice but to comply.

And if that company is one that is involved in sensitive global telecoms infrastructure projects, it’s easy to see why Western observers would be worried.

There is no evidence to indicate that Huawei is in any way under the orders of the Chinese government, or that Beijing has any plans to dictate business plans and strategy at Huawei – particularly when it comes to spying.

But the way in which the Chinese Communist Party has robustly defended Huawei has raised questions about how independent the company is of its influence.

For example, Beijing stated that Ms Meng’s detention was a rights abuse .

And while her extradition case to the US was moving forward, China detained two Canadian citizens and accused them of stealing state secrets. Critics say the detentions are linked to Ms Meng’s arrest.

December 2018: Chinese police patrol outside Canada's embassy in Beijing

December 2018: Chinese police patrol outside Canada’s embassy in Beijing

While not commenting on the arrest of the Canadians, Ren says China’s defence of Huawei is understandable.

“It is the Chinese government’s duty to protect its people,” he says. “If the US attempts to gain competitive edge by undermining China’s most outstanding hi-tech talent, then it is understandable if the Chinese government, in turn, protects its hi-tech companies.”

Over the past few years, there have been signs of a bigger push by the government to get private companies, and in particular tech firms, to cooperate with party rules – even when they are firmly resistant.

 A Didi Chuxing logo adorns a building in Hangzhou, China

 A Didi Chuxing logo adorns a building in Hangzhou, China

China’s ride-hailing giant Didi Chuxing’s troubles are an example of the struggles Chinese firms face when they try to uphold their independence in the face of government pressure.

Chinese attitudes to data collection and data privacy are different to those in the West – many people don’t care if businesses have access to their data, arguing that it adds to the convenience of life and work.

Government access to data in China is not the free-for-all that many outside of China assume it to be

Samm Sacks, CSIS

So it wasn’t unusual when, after the murders of two of its passengers by Didi drivers, regulators used the scandal to force Didi to share more corporate data with the government. But Didi resisted – citing customer privacy. Under Chinese law, it had no choice but to comply.

When it did, it handed over “three boxes of data printed on paper, including 95 hard copies for authorities to review”.

According to Samm Sacks of the Center for Strategic and International Studies (CSIS), the case demonstrates that “government access to data in China is not the free-for-all that many outside China assume it to be”.

She says this indicates that there appears to be “a kind of tug of war between the government and companies over data”.

How this plays out will determine how Chinese companies are viewed by foreign governments when they do business overseas.

Companies like Huawei have grown up in a system where to survive and thrive they needed strong links to the Chinese government – there was and is no other choice. But these links could harm their reputation abroad.

“It’s two different systems,” says Zaagman. “Think of it like an electrical outlet. China’s plug doesn’t fit in to the outlets we have in the West.”

What’s at stake

“Basically you want to connect to everything that can be connected.”

Zhu Peiying, head of Huawei’s 5G wireless labs, is showing off devices that can connect to the new technology. From a smart toothbrush that collects data about how well you brush your teeth, to a smart cup that reminds you when you should drink some water, this is a world where everything you can think of is being measured and analysed.

At its most sophisticated, everything in entire cities would be connected – driverless cars, the temperature of buildings, the speed of public transport – the list is endless.

Huawei is thought to be a year ahead of its competitors in terms of its technological expertise and what it can offer customers, according to industry sources.

It’s also thought that the company can offer prices that are about 10% cheaper than its competitors, although critics claim this is because of state support.

Ren dismisses this, saying that Huawei doesn’t receive government subsidies.

He says the real reason behind the US resistance to Huawei is its superior technology.

“There’s no way the US can crush us,” he says. “The world needs Huawei because we are more advanced. Even if they persuade more countries not to use us temporarily we could just scale things down a bit.”

Many analysts say that Huawei’s exclusion from US networks could actually cause the US to fall behind in its 5G capabilities.

“It would mean we wouldn’t be able to participate in any blended network [using Huawei] in Europe or Asia,” says Samm Sacks of CSIS. “That would put us at a significant disadvantage.”

What this would mean in reality is a world of two internets – or what analysts are calling a “digital iron curtain” – dividing the world into parts that do business with Chinese companies like Huawei, and those that don’t.

Because of US pressure on its allies, Huawei has been on an aggressive public relations campaign to win over customers and government stakeholders.

In recent days, Vodafone’s boss Nick Read called on the US to share any evidence it has about Huawei, while Andrus Ansip, the European Commission’s vice president for the digital single market, said in a tweet that he had met with Huawei’s rotating CEO to discuss the importance of being open and transparent, as they explored ways of working together.

But suspicions about Huawei remain.

One security firm reports a sharp rise in inquiries by Asian government clients about Huawei.

“Some have asked us how much they should worry about whether Huawei is really a liability,” says an analyst who consults to Asian governments, on condition of anonymity.

Ren is sanguine about such concerns.

“For countries who believe in them [suspicions about Huawei] we will hold off,” he says. “For countries who feel Huawei is trustworthy, we may move a little faster. The world is so big. We can’t walk across every corner of it.”

But this is about more than just one company or one CEO and his family.

Increasingly, this is perceived as a battle between two world orders, and which one is the future.

In the early days of China opening up, US presidents like George HW Bush espoused the merits of engagement.

“No nation on Earth has discovered a way to import the world’s goods and services while stopping foreign ideas at the border,” he said in a 1991 speech. “Just as the democratic idea has transformed nations on every continent, so, too, change will inevitably come to China.”

1989: George HW Bush in Beijing - he encouraged economic engagement with China

1989: George HW Bush in Beijing – he encouraged economic engagement with China

Previous US administrations believed that economic engagement in China would lead to China following a freer, more “liberal” path.

There’s no denying China has made remarkable strides in the past 40 years. The economy grew by an annual average of 10% for three decades, helping to lift 800 million people out of poverty. It is now the second-largest economy in the world, only surpassed by the US.

Some estimates put China’s economy ahead of America’s by 2030.

It achieved this while maintaining one-party rule and the supremacy of the Communist Party.

But its success has raised concerns that it is only possible with a huge amount of government control over the country’s companies. The fear is that control could be used to achieve the Communist Party’s goals – which are at this point unclear.

“It’s a double-edged sword for China,” says Danielle Cave. “[Because of its laws] the Chinese Communist Party has made it virtually impossible for Chinese companies to expand without attracting understandable and legitimate suspicion.”

Added to this, China has become more authoritarian under Xi Jinping’s rule.

President Xi Jinping 

President Xi Jinping 

“Xi is systematically undermining virtually every feature that made China so distinct and helped it work so well in the past,” writes Jonathan Tepperman, editor in chief of Foreign Policy.

“His efforts may boost his own power and prestige in the short term and reduce some forms of corruption. On balance, however, Xi’s campaign will have disastrous long-term consequences for his country and the world.”

But Ren dismisses this, insisting that China is more open than ever before.

“If this meeting took place 30 years ago,” he says of our interview, “it would have been very dangerous for me. Today, I can be straightforward when answering difficult questions. This shows that China has a more open political environment.”

Still, Ren is hopeful of the direction China will take in the future.

“China has more or less tried to close itself off from the outside world for 5,000 years,” he says. “Yet we had found ourselves poor, lagging behind other nations. It was only in the past 30 years since Deng Xiaoping opened China’s doors to the world that China has become more prosperous. Therefore, China must continue to move forward on the path of reform and opening-up.”

In one of Huawei’s vast campus sites across Shenzen, lies a man-made lake. Swimming in these serene waters are two black swans.

There is a story that Ren put the birds here to remind employees of “black swan” events – unpredictable and catastrophic financial eventualities that are impossible to prepare for. He dismisses this as an urban myth, but it’s hard not to read something into it.

For Huawei, and Ren, these are highly uncertain times with no way of telling what lies ahead.

Source: The BBC

04/03/2019

Huawei’s Meng Wanzhou sues Canada authorities over arrest

Huawei's chief financial officer Meng WanzhouImage copyrightREUTERS
Image captionMeng Wanzhou’s arrest has strained relations between China, and Canada and the US

The chief financial officer of China’s tech giant Huawei is suing Canada over her arrest at the request of the US.

Meng Wanzhou was held in December at Vancouver airport on suspicion of fraud and breaching US sanctions on Iran.

On Friday Ms Meng filed a civil claim against Canada’s government, border agency and police for “serious breaches” of her civil rights.

It came on the same day that Canada officially launched Meng Wanzhou’s extradition process to the US.

China has attacked Ms Meng’s arrest and the extradition process as a “political incident”. She denies all the charges against her.

What does Ms Meng’s lawsuit say?

Ms Meng’s claim – filed in British Columbia’s Supreme Court on Friday – seeks damages against the Royal Canadian Mounted Police (RCMP), Canadian Border Services Agency (CBSA) and the federal government for allegedly breaching her civil rights under Canada’s Charter of Rights and Freedoms.

She says CBSA officers held, searched and questioned her at the airport under false pretences before she was arrested by the RCMP.

Meng Wanzhou's property in VancouverImage copyrightREUTERS
Image caption
Ms Meng has a property in Vancouver and is currently out on bail

Her detention was “unlawful” and “arbitrary”, the suit says, and officers “intentionally failed to advise her of the true reasons for her detention, her right to counsel, and her right to silence”.

Where are we in the extradition process?

Ms Meng, 47, will next appear in court on Wednesday, when it will be confirmed that Canada has issued a legal writ over her extradition to the US. A date for an extradition hearing will be set.

But this is still the early stages. A judge must authorise her committal for extradition and the justice minister would then decide whether to surrender her to the US.

There will be chances for appeal and some cases have dragged on for years.

Presentational grey line

The Meng Wanzhou case – how did we get here?

  • 1 December: Ms Meng, the daughter of Huawei’s founder, is arrested while changing planes at Vancouver airport
  • 7 December: Ms Meng first appears in court in Vancouver, where it is revealed she is accused of breaking US sanctions on Iran. China demands her release
  • 10 December: Canadian citizens Michael Kovrig and Michael Spavor are arrested in China
  • 11 December: Ms Meng is released on bail
  • 28 January: US formally charges Ms Meng with fraud and Huawei with circumventing US sanctions on Iran and stealing technology from T Mobile
  • 2 March: Canada says Ms Meng’s extradition can move forward but the process is expected to be long
Presentational grey line

What is Huawei accused of?

The US alleges Huawei misled the US and a global bank about its relationship with two subsidiaries, Huawei Device USA and Skycom Tech, to conduct business with Iran.

US President Donald Trump’s administration has reinstated all sanctions on Iran removed under a 2015 nuclear deal and recently imposed even stricter measures, hitting oil exports, shipping and banks.

It also alleges Huawei stole technology from T Mobile used to test smartphone durability, as well as obstructing justice and committing wire fraud.

In all, the US has laid 23 charges against the company.

Some Western nations are reviewing business with the firm over spying concerns, although Huawei has always maintained it acts independently.

How has China reacted?

Media caption – Huawei founder Ren Zhengfei on the arrest of his daughter

The arrest has seriously strained relations between China, and the US and Canada.

Beijing says it is an “abuse of the bilateral extradition treaty” between Canada and the US, and has expressed its “resolute opposition” and “strong dissatisfaction” with the proceedings.

China also says the accusations against Huawei, the world’s second biggest smartphone maker by volume, are a “witch-hunt”.

Two Canadian citizens are thought to have been detained in China in retaliation for the arrest.

China and the US are also engaged in tough trade negotiations to end a major tariff dispute.

Source: The BBC

03/02/2017

Apple Is Set to Make in India, State Official Says – India Real Time – WSJ

In a potential boost to Prime Minister Narendra Modi’s “Make in India” initiative, tech giant Apple Inc. is nearing a deal with Taiwanese contract manufacturer Wistron Corp. to start making products in the southern state of Karnataka, a senior state official said.

“The contractual agreement between the two companies is on the verge of being signed,” the Karnataka government official who has direct knowledge of the matter said.

The first phase of assembling iPhones will likely start as early as the end of March, and further expansion is expected over the next two to six months, the official said.An Apple spokeswoman said the company has nothing to share beyond a statement it made last week, which said: “We appreciate the constructive and open dialogue we’ve had with [the] government about further expanding our local operations.”

A Wistron spokeswoman declined to comment. The company has a factory in the southern Indian city of Bangalore where it makes smartphone components, and has sought permission from the state authorities to expand the facility with additional power supply and fire-fighting facilities, the official said.

“What we are given to understand is that Apple is awaiting a final word from the government of India regarding tax and tariff concessions sought by the company, before signing up the contractual agreement,” the official said.

Making goods such as the iPhone locally may help the Cupertino, Calif., company to open its own stores in India, in turn building its brand in a country where it has less than a 5% share of a booming smartphone market.

Karnataka’s Information and Technology minister, Priyank Kharge, welcomed Apple’s proposal to consider Bangalore, also known as Bengaluru, as the location for potential manufacturing.

“Apple’s intentions to manufacture in Bengaluru will foster cutting edge technology ecosystem and supply chain development in the state, which are critical for India to compete globally,” Mr. Kharge said in a statement Thursday.Apple is looking to ramp up revenues in India as sales stagnate in China, long an engine of growth. India should soon overtake the U.S. as the world’s second-largest smartphone market after China. Smartphone shipments in India grew 18% last year, compared with just 3% globally, according to Counterpoint Research.

Apple Chief Executive Tim Cook in a call with analysts this week confirmed the company is “in discussions” to open retail stores in the country, and said Apple intends to “invest significantly in the country and believe it’s a great place to be.” (http://blogs.wsj.com/indiarealtime/2017/02/01/what-tim-cook-said-about-apples-big-plans-for-india/)

Last week, a team of executives led by Priya Balasubramaniam, an Apple vice president, met with senior Indian government officials in New Delhi as well as state officials in Karnataka to discuss the firm’s proposals. (https://www.wsj.com/articles/apple-nears-deal-to-manufacture-products-in-india-1485340934)

Under Mr. Modi, India has been eager to attract foreign investment and create the manufacturing facilities and jobs the country needs to sustain long-term growth.

Source: Apple Is Set to Make in India, State Official Says – India Real Time – WSJ

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26/07/2016

Could India Become a Cashless Economy? – India Real Time – WSJ

Cash is set to lose currency in India, as an explosion in smartphone usage drives a digital payments boom, according to a new report.

By year 2020, nearly $500 billion worth of transactions in India will happen digitally, using online wallets and other digital-payment systems, 10 times the level currently, according to a report by Google India and The Boston Consulting Group.

Indians traditionally prefer to save and spend in cash, and a vast majority of the more-than 1.2 billion population doesn’t have a bank account.

Last year, 78% of all consumer payments in India were made by cash, whereas in developed countries like the U.S. and U.K., only 20% to 25% of such payments were made that way, the report said.

But the reliance on notes and coins in India is likely to diminish, as spending habits change and financial services reach more people, said the Google-BCG report. It expects cash-based consumer payments to fall to 40% to 45% by 2025.

A sharp increase in the use of mobile phones with internet connectivity will help drive the move to digital payments, said the report.

India has more than 1 billion mobile subscribers, a quarter of whom use smartphones, according to the report. By 2020, the number of smartphone users in the country will likely be 520 million, and the number of internet users 650 million, twice the number currently, according to the report.

Personal internet banking has become more popular in India over the past few years along with digital payment options that allow users to settle mobile phone, electricity and even taxi bills.

The recent spurt of growth has come from non-bank companies offering payment services. Cellphone companies like Airtel and Vodafone offer facilities to transfer money using phones, while “wallet” companies like One97 Communications’ Paytm unit, and MobiKwik, allow users to store money digitally and pay through their systems.

The next level of growth will come when local mom-and-pop grocery stores start accepting digital payments, said the report.However, there are plenty of consumers and merchants who still feel skeptical of digital payments, or find them too complicated, said the report. And others just don’t want to give up using cash, it added.

Source: Could India Become a Cashless Economy? – India Real Time – WSJ

18/06/2016

New App Promises to Tell Indian Farmers When to Sow Crops – India Real Time – WSJ

Monsoon season in India has just begun, but farmers in Andhra Pradesh, a southeastern coastal state of India, won’t need to look to the skies to know when to sow their crops.

A new mobile application launched earlier this month and developed by a local agriculture research institute, Microsoft India and the state government tells farmers in the state which week is perfect for sowing seeds, the health of their soil and other indicators.

The app uses rainfall data collected from farms in 13 districts in Andhra Pradesh over 45 years to give farmers a sense of when to start planting, Suhas P. Wani, director of Asia research at the International Crops Research Institute for Semi-Arid Tropics or ICRISAT, a research organization in Hyderabad said.Farmers are asked to register a mobile number with the state government, choose a language–currently limited to the regional Telugu and English–and enter details of the village, district or sub-district.

The advice received could vary from farmer to farmer and from village to village, Mr. Wani said. “The app has crop-specific information such as 10 years of groundnut sowing progress data” to guide farmers who grow specific crops, he added.

He said that constant data on crop yield was being collected on a monthly basis by field officers and sent for evaluation to provide regular forecasts to farmers.

A weather button shows the temperature and rainfall as well as fertilizer recommendations for the day and projection for the next seven days. Additionally, a farmer can get weather alerts for extreme conditions like hailstorms or unseasonal rains that impact crop yields.

Andhra Pradesh logged the highest number of farmer suicides in the country last year. At least 58 farmers took their own lives in the state, according to an agriculture ministry report.

But not every farmer can afford to invest in expensive smartphone technology.

So far, most of the farmers have requested to be sent the information via SMS message. Mr. Wani said once registered, farmers can get the predicted sowing date through SMS. “The main idea behind the application is to help farmers reduce losses by telling when to sow seeds or spray the plants,” he said.

The application will be rolled out in other Indian states next year, based on feedback from farmers in the state, he added.

Source: New App Promises to Tell Indian Farmers When to Sow Crops – India Real Time – WSJ

20/04/2015

Xiaomi to Unveil its Newest Phone in India First – India Real Time – WSJ

Cheap smartphone maker Xiaomi Corp. is set to unveil its latest phone on Thursday in Delhi – the first time it has held a global launch in India – and in typical fashion is drumming up interest by turning the event into a velvet-rope affair.

Xiaomi has released no details about the new phone or any of its features, but that didn’t stop over 6,000 people from applying for a limited number of tickets to attend the “global premiere” on the company’s Facebook page.

The Chinese firm hasn’t said how many public tickets are on offer, but a post by the company on Facebook said that “seats are very limited.” Siri Fort, where the event will be held, has four auditoriums and the largest can seat 1,865 people.

via Xiaomi to Unveil its Newest Phone in India First – India Real Time – WSJ.

02/04/2015

African phone sales soar, Chinese makers have 30% of market – Business – Chinadaily.com.cn

With a growing number of Chinese cell phone makers taking giant strides in overseas markets, Africa, with its huge population, is also in its sights.

African phone sales soar, Chinese makers have 30% of market

OPPO, a Chinese producer, has unveiled two smartphones, OPPO N3 and OPPO N5, in Morocco, taking the number of Chinese cell phone makers in Africa above 10.

The first batch of manufactures entering the African market were copy makers based in Shenzhen, South China’s Guangdong province, China Business News cited Yan Zhanmeng, a senior analyst of IDC China, as saying. With a smartphone boom in 2013, more famous Chinese makers have been tapping into the market, Yan added.

IDC data showed that the market share of Chinese cell phone brands rose to 30 percent in 2014, from 15 percent two years earlier. Huawei, Tecno and Alcatel have entered the top five in the African market, which surged 108 percent last year.

Africa has a population of one billion, accounting for 15 percent of the world population. Most important is that the number of cell phone users has exceed 200 million, even during the 2009 financial crisis, the growth rate hit 14.8 percent.

Nigeria, with the biggest population in Africa, currently has the most cell phone users, accounting for 16 percent of total users on the continent, followed by Egypt and South Africa. In the next five years, the most obvious growth will focused in Central and East Africa, among which growth in Ethiopia, Congo, Eritrea and Madagascar is expected to exceed 100 percent.

via African phone sales soar, Chinese makers have 30% of market – Business – Chinadaily.com.cn.

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