AT&T Urged by Lawmakers to Cut Ties with China's Huawei

Posted January 17, 2018

Congressman Mike Conaway (R-Texas) introduced a bill last week called "The Defending U.S. Government Communications Act" which would prohibit the U.S. government from purchasing or leasing telecommunications equipment and/or services from Huawei and another Chinese firm ZTE. With so much of the production of silicon already taking place in China, there's nearly no way to avoid it if rogue actors did want to get in. In 2011, the two companies were the subject of a report from the House of Representative's Permanent Select Committee on Intelligence, which recommended that the U.S. government be prohibited from buying Huawei and ZTE products, as well as continued vigilance, investigation, and legislation to address the concerns.

Over the last week, members of Congress have been getting tough on the two Chinese companies, formally identifying both as threats to national security following years of investigations.

Experts in national security fear any data from a device made by Huawei, for example related to the location of the user, would be made available to the intelligence service in the Chinese government.

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Conaway's bill is another major hurdle for Huawei's market in U.S. Lawmakers in U.S have long anxious about the company, and this new bill have opened a new chapter. Reports also said Huawei was discussing a deal with AT&T but it was later revealed that the deal had collapsed.

It is now being reported that the United States government wants AT&T to cut all commercial ties with AT&T, including any work the two have made on the development of 5G standards. However, sources claims that officials are pressuring AT&T to stop offering Huawei phones through its Cricket prepaid subsidiary, and to also stop working with Huawei on 5G network standards.

AT&T and other telecom giants are being warned to avoid doing business with Chinese hardware manufacturer Huawei if they want to be able to secure government contracts.

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The federal government also blocked a series of acquisitions by Chinese companies over concerns of national security including the proposed purchases by Ant Financial of USA based money transfer business MoneyGram International.

The Huawei issue drew the attention of the Chinese foreign ministry, which said that "we hope that China and the United States can work hard together to maintain the healthy and stable development of trade and business ties".

AT&T is under political pressure to cut all ties to Huawei.

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Huawei has long protested that its equipment contains no backdoors that could threaten U.S. communications infrastructure, however.