Unfazed by Critics, UK Firm Inks Huawei Deal

Even as U.S. firms are being cautioned about doing business with Huawei Technologies Co., European solution providers are strengthening their ties to the Chinese telecommunications and networking vendor and expanding profitable partnerships with the firm.

CRN UK late last week reported that major system builder Stone Group of Staffordshire, England is looking to boost its professional services efforts by adding a broad range of Huawei networking and unified communications solutions to its portfolio. The move expands a year-old exclusive relationship with the Chinese firm to sell and service storage gear developed in a joint venture between Huawei and Symantec Corp.

“We have a very strong relationship with Huawei and we have chosen them specifically to help us extend a richer, more complete professional services offering to our clients,” Tim Killick, Stone’s group bids and infrastructure services manager, told the UK publication.

The additional Huawei products will be added to Stone’s professional services operations, Killick said.

The agreement between Stone and Huawei is a significant victory for the Chinese vendor which has faced months of allegations in the United States — championed by competitors such as Cisco Systems Inc. — that it poses a national security threat and engages in intellectual property theft.

Huawei has been under the gun since early October when Rep. Mike Rogers (R-Mich.), chairman of the powerful House Select Committee on Intelligence, appeared on CBS’s 60 Minutes to warn the U.S. market of what lawmakers perceived as the Huawei threat.

“If I were an American company today… and you are looking at Huawei, I would find another vendor if you care about your intellectual property, if you care about your consumers’ privacy, and you care about the national security of the United States of America,” Rogers said.

The House admonition was followed with reports that the Obama administration had led its own security review of Huawei equipment and business practices and found no evidence of espionage or deliberate cybersecurity threats or practices that would undermine the national security of the United States, Reuters news service reported. The White House has since denied it authorized any such report and disavowed the conclusion that Huawei had been exonerated.

China’s Commerce Minister Chen Deming, a Communist Party member, responded to the controversy this past weekend, saying “The U.S. raised the security issue of Huawei and ZTE to the level where they are asking whether the companies have Communist Party cells and what their relations are with the party. Can you imagine if China started asking U.S. companies coming to China what their relationship was with the Democratic or Republican parties? It would be a mess. Personally I think this has gone too far.”

The damage for Huawei may have already been done in the United States, however. A poll conducted by Channelnomics and The 2112 Group after the House report was made public found that U.S. solution providers overwhelmingly felt the U.S. assertions against Huawei would dampen sales and marketability of the company’s products, and they would be less likely to work with companies labeled as a national security threat.

But that sentiment clearly isn’t resonating with solution providers across the globe, as the latest Stone partnership attests.

“The opportunity to bring our joint solutions to the education and wider public sectors by working together is very important for Huawei in these key vertical sectors,” David Poskett, Huawei’s UK and Ireland vice president told CRN UK about the Stone arrangement. “The additional layer on top of the solutions – Stone’s UK customer support – makes this a very significant partnership for Huawei.”