As U.S. military brass continues to beat the warning drum about an ascendant China threatening the global order, the company responsible for some of the world’s hottest smartphones is being called out as another Chinese front in the burgeoning battle for supremacy with the United States.
The cellphone behemoth Huawei was started by a former Chinese military official and has “extraordinary ties to the Chinese government,” Senate Select Intelligence Committee Chairman Sen. Richard Burr said in February.
Due to security concerns, the federal government has moved to restrict Huawei’s operations in the United States and the Pentagon this week ordered military exchanges to stop selling electronics made by Huawei and its Chinese competitor, ZTE.
“It’s not just the South China Sea,” Navy Secretary Richard Spencer told the Senate Appropriations Committee last month. “It’s across the full spectrum that China is coming at us.”
The Navy’s top civilian has repeatedly sounded off in recent months on the need to keep Huawei out of military projects, showcasing how U.S. concerns about the company loom beyond consumer electronics.
Spencer said the sea service is upping its vigilance to ensure that Huawei doesn’t sneak into Navy systems via the arcane labyrinth of the military contract world.
“What we’re finding as we drill down is, if you got two and three layers of holding companies, all of a sudden China Inc. is the owner,” Spencer told Congress earlier this year. “And we have to start paying attention to this, and we are.”
He has in several congressional committee hearings shared details of a Huawei-related incident involving a Military Sealift Command contract for ship software.
Huawei was found to be a “joint venture partner” with a division of GE that the Navy was contracting with, he told a House hearing in March.
“Huawei is on the (National Security Agency) list for don’t touch,” Spencer said, and the Navy immediately worked to figure out what GE’s relationship is with the company.
“We turned around and said, ‘Whoa, stop the horses,’” Spencer told the Senate Armed Services Committee last month. “We’d like to know what this means.”
Spencer said GE officials reassured them that they were “not going to use any of the assets of Huawei, nor its software.”
“We said, ‘Great, can we see the governance documents of the joint venture?’ And things got very frosty,” Spencer told the committee.
As a result, the Navy had to insert “prophylactic language in there that will protect us,” he told the appropriations committee.
“This is a continuing issue,” Spencer said.
GE spokeswoman Una Pulizzi said the company has a non-binding memorandum of understanding between its digital division and Huawei from 2016, “for the purpose of exploring potential civil commercial activities.”
“The MOU is disconnected from any of GE’s US military engagements,” she said in an email. “We addressed the Navy’s questions related to the MSC contract and are moving forward.”
MSC spokesman Nathan Potter said Huawei was not involved in the Navy contract for GE’s Predix Asset Performance Management software, which helps optimize maintenance costs and enhance performance.
“The Navy and MSC concurred with GE’s assessment that the software being used onboard possesses no additional vulnerability than any other server software currently on ships,” Potter said in March. “The system adds no additional connections and no additional security risks. Also, Predix software will only be used ashore.”
Huawei already sells products in 170 countries worldwide, and a current ad campaign on its U.S. website features “Wonder Woman” actress Gal Gadot and the slogan, “the best phone you’ve never heard of.”
Company officials pushed back against security concerns in a statement to Military Times this week.
“We remain committed to openness and transparency in everything we do and want to be clear that no government has ever asked us to compromise the security or integrity of any of our networks or devices.,” officials said in a statement.
The Pentagon cited unspecified security concerns this week when it banned the sale of Huawei and ZTE products from military exchanges.
“Huawei and ZTE devices may pose an unacceptable risk to the Department’s personnel, information and mission,” DOD spokesman Army Maj. Dave Eastburn told Military Times.
The Pentagon is evaluating whether it will need to implement a ban on the purchase and use of the company’s products, he said, and troops using such devices “should be aware of the media coverage concerning the security risks posed by the use of the devices, regardless of where the service member purchased the device.”
Risks exist when entities “beholden to foreign governments” are allowed to operate in U.S. networks, FBI Director Christopher Wray told the Senate’s Select Intelligence Committee in February.
“It provides the capacity to maliciously modify or steal information, and it provides the capacity to conduct undetected espionage,” he said.
Huawei and other companies need to play by the rules in Western markets, committee vice chairman Sen. Mark Warner, said at the hearing.
“Most Americans have never heard of all these companies,” the Virginia Democrat said. “We need to make sure that this is not a new way for China to gain access to sensitive technology.”
Such concerns come after reports that China pilfered American stealth fighter jet designs to build its own versions over the years, among other alleged cyber-related nefariousness that some fear has narrowed the military gap between the two countries.
“What Beijing has been very good at is targeting U.S. defense contractors, getting into their computer systems through various types of essentially cyber warfare and stealing the designs of some of America’s best military assets,” Harry Kazianis, defense studies director at the Center for the National Interest, told CNBC late last year.
On other U.S. government fronts, a bill has been introduced in the Senate that would prevent the government from using Huawei or ZTE products, or from contracting with companies that use them.
The Federal Communications Commission voted last month in favor of a plan that would limit the ability of the companies to sell their products in the United States, the New York Times reported.
Governments from Canada to Australia and other allies are now considering the security implications of Huawei as well, according to the Wall Street Journal.
National Security Agency head Adm. Mike Rogers told the committee that the challenges posed by companies like Huawei will only increase over time.
Sen. Tom Cotton asked Rogers what U.S. mayors, county judges, university presidents and other functionaries should do if “Huawei or ZTE comes bearing gifts for them.”
“I would say you need to look long and hard at companies like this,” Rogers said.
Cotton asked the intel agency heads if any of them would ever use a Huawei or ZTE product, or recommend any American citizens use them.
None of the intel heads raised their hand.