Why is the U.S. so concerned about Huawei?

Digital Originals

Richard Yu, CEO of the Huawei Consumer Business Group unveils the new Huawei P30 and P30 Pro smartphones during a launch event in Paris, France, March 26, 2019. REUTERS/Charles Platiau

Huawei. The Chinese tech giant has been making headlines. Their CFO, Meng Wanzhou, was recently arrested in Canada and is set to face extradition hearings in May that could send her to the U.S. The U.S. accuses her of conspiring to violate trade sanctions against Iran.

The U.S. also claims Huawei’s technology could pose a security threat because of its ties to the Chinese government, with a chief concern being that Huawei was founded by a military officer… who also happens to be the father of the arrested CFO.

But there’s more to this story than meets the eye. CGTN’s Mark Niu reports.

First of all, what exactly does Huawei do?

It’s the second largest smartphone maker in the world.

Huawei just passed Apple in units shipped and only trails Samsung for the top spot.

Hundreds of companies from around the world also supply parts to Huawei, including 33 U.S. companies, and big ones like Qualcomm, Intel and Microsoft.

Huawei dominates telecom equipment with a 28 percent share of the global market.

The next closest — Nokia, Ericsson and Cisco — still far behind.

In fact, Huawei’s telecom technology is already spread throughout infrastructure spanning form Europe all the way to rural America.

And the big concern — 5G.

We’ve heard that term thrown around a lot.

Essentially, it’s the next generation of wireless infrastructure that will be at least 10 times faster than our current connections.

You’ll be able to download 8K resolution movies on a phone instantly.

High-powered virtual reality will work without lagging making experiences all the more real.

It’ll usher in the era of self-driving cars, which need to make trillions of calculations per second.

Billions of machines will be able to take to each other and make decisions through artificial intelligence.

That leads to the question: Why is the U.S. so concerned about Huawei?

Well, Huawei is one of the biggest spenders on research and development, $13.2 billion in 2017, and likely even more when the numbers come in for 2018.

Analysts say it’s by far the leader in 5G network technology, with some saying it’s even a year ahead of the competition.

A Huawei executive has quipped that a 5G network without Huawei is like the English Premier League without Manchester United.

Huawei is in prime position to snatch the lion’s share of the 5G market which in five years could be worth $123 billion.

The U.S. has been pressuring its allies to exclude Huawei from their 5G networks.

Australia and New Zealand have done exactly that, while countries like the U.K. and Germany have so far resisted, saying they can minimize any risk.

But without firm evidence that Huawei has used network equipment for spying, some believe stalling the company’s expansion into Western markets is just a way to help competitors catch up, to break Huawei’s stronghold on the market.

But Huawei counters that countries choosing to go without their advanced technology, will be the ones left behind in the 5G revolution.