Huawei, ZTE Feeling Washington’s Sanctions

Huawei and ZTE logos with the Chinese and American flags

The United States and Huawei continue to feud over security concerns but after Huawei was able to maintain a steady course, the Chinese giant may be beginning to feel the effects of the actions Washington has put into place. The sanctions in place are disrupting a supply chain that is already hurting from the ongoing COVID-19 pandemic. These disruptions make it difficult for companies like Huawei and ZTE to not only gain access to the components they need to build within China, but can make approved components inaccessible and hinder the work they can conduct in other countries.

Evidence that these hindrances are coming into play is being seen as both Huawei and ZTE are slowing installations of 5G base stations to increase 5G coverage throughout the country due to a lack of access to the components needed to complete the job. The pandemic and bad  weather have added to already unfavorable conditions for the country with further complications expected. The sanctions will go into 2021, well after the presidential election. Should the Trump administration be removed from office, it will be interesting to see how the White House proceeds going forward with dealing with China and its telecom companies but there are signs that this may be one of the rare issues both sides can agree upon. Nancy Pelosi has also been a vocal figure in the distrust of Huawei’s involvement in developing 5G networks.

Other Countries Continue to Boycott Chinese Companies

The U.S. is not alone in its fight against Chinese telecommunications. Huawei has seen a variety of backlash from countries including the Czech Republic, the U.K., and now India as tensions rise between their governments and armed forces. The ramifications of these bans, sanctions, and backlash are yet to be seen but Huawei and China have been planning to extend their reach in markets like Europe for quite some time. The loss of these opportunities will hurt the Chinese companies in major markets and may also harm their credibility going forward.

Nevertheless, where one door closes, another can open. The U.S. has begun unleashing more mid-band spectrum and has concluded an impressive FCC auction that is allowing more companies the opportunity to become involved in the 5G world. Going forward, the lack of Chinese companies within American and European markets should present opportunities for companies of those regions to step up and provide networking solutions for operators, vendors, and carriers.

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Source: PC Mag