Huawei Goes on Offense in the Battle for Hearts and Minds

(Bloomberg) -- Huawei Technologies Co. has turned to a blend of wit, sarcasm and defiance to publicly fight allegations that the world’s largest maker of telecommunications equipment is spying for China. It’s a remarkable shift for a giant whose founder Ren Zhengfei spurned the media and avoided overt displays of power..Rotating Chairman Guo Ping encapsulates its new credo. Striding onstage before hundreds of people at the phone industry’s flagship conference this week, he opened with a joke directly addressing the company’s demons: “There has never been more interest in Huawei. We must be doing something right.”.Guo laid into the U.S., which vaulted Huawei into the public eye when it orchestrated last year’s arrest by Canadian authorities of Chief Financial Officer Meng Wanzhou, who is also the founder’s daughter. He urged the crowd in Barcelona to reject using politics to manage cyber security and turned the spotlight on America, which he said was spying on its own corporations. Some audience members applauded..“Prism, prism on the wall, who is the most trustworthy of them all?” Guo said, referring to the code name of the surveillance system used by the U.S. to access private communications from internet companies. “If you don’t answer that, you can go ask Edward Snowden.”.In the short span since Meng’s Dec. 1 arrest, Huawei has gone from besieged target to unapologetic champion of telecommunications security. Assailed by U.S. accusations it aids Beijing, it has morphed into an outspoken company few could have imagined just a year ago. That comes despite facing a concerted American campaign to blockade it from operating in Europe, Australia and around the world..How Huawei Became a Target for the U.S. Government: QuickTake.The jury is still out on whether the charm offensive has worked, but in recent weeks the discussion has grown more nuanced. European carriers have offered to help governments devise a way to work with Huawei while warding off security concerns. Leaders in New Zealand, Italy, Germany and the U.K. have pushed back against U.S. pressure for a blanket ban on the Shenzhen-based company’s products..“The U.S. seems to have hit a snag with skeptical responses coming out of the U.K. and other governments saying let’s look at Huawei in a more granular fashion,” said Graham Webster, a fellow at Washington-based research group New America who studies China’s digital economy..Huawei Issue Opens Rift Between U.S. and Global Carriers.Huawei was largely unknown outside of China before recent clashes with the U.S., and Ren hadn’t spoken with foreign media since 2015. But in recent years, the closely held company started publicly releasing financial statements, sponsoring sports teams and churning out cheeky ads around the world..After Meng’s arrest, it orchestrated an unusual public relations move by releasing a translated entry from her personal diary. Huawei said she’d kept a journal for years and wanted to share her feelings on recent events, including how she burst into tears after supporters contacted her to protest her arrest..Then in January, Huawei invited journalists from foreign media to a round-table discussion with billionaire Ren, who denied espionage allegations and a link to the Chinese government and called Donald Trump a “great president.” The founder has been charging hard on the speaking circuit ever since, including sitting down for tea with the BBC, where he stressed that there’s “no way the U.S. can crush us.”.Read more: Huawei’s Founder Denies Spying, Praises ‘Great’ President Trump.The company created a web page and Twitter account called @Huaweifacts, started beefing up its media relations teams and touted new technologies around 5G and its newly-launched $2,600 foldable mobile phone. On Wednesday, Guo penned a commentary piece for the Financial Times in which he criticized the hacking of Huawei servers by the National Security Agency..“Clearly, the more Huawei gear is installed in the world’s telecommunications networks, the harder it becomes for the NSA to ‘collect it all,” he wrote. “Huawei, in other words, hampers U.S. efforts to spy on whomever it wants. This is the first reason for the campaign against us.”.A Huawei executive even reached out to Trump directly on Twitter when the U.S President commented on American digital supremacy..“Mr. President. I cannot agree with you more. Our company is always ready to help build the real 5G network in the U.S., through competition," wrote Ken Hu, another of Huawei’s rotating chairmen..Inside the company, Ren told employees to be “combat ready” in the face of global competition and geopolitical challenges..“Now, some countries want to block our investment in scientific research, disrupt our efforts to learn the advanced technologies,” Ren said when addressing employees at a company event on Feb. 16. “We need to be prepared.”.How Huawei Arrest Extends Troubled History With U.S.: QuickTake.Huawei’s communications team said it’s ramping up efforts to respond to what it calls “false allegations, fake news and rumors.” The company kept a low profile in the past because it was privately owned in a highly competitive industry, which could have led to “misperceptions we are too secretive,” spokesman Glenn Schloss said..But Guo’s speech in Barcelona seems to take those efforts to a new level, buoyed by a greater sense of urgency ahead of key court dates. On Thursday, U.S. prosecutors in Seattle are due to detail their criminal case against Huawei, including allegations of intellectual property theft. On March 1, Canada will have to decide whether to extradite Meng, whose next court date is March 6..“The Prism speech was definitely a different level of messaging,” said Webster, the New America fellow..By bringing up the U.S. program, Huawei may be trying to curry favor and remind Europe that the U.S. doesn’t have a spotless track record when it comes to state surveillance, Webster said. Still, Western governments remain cautious about Huawei and have real security concerns as they continue talking to Samsung Electronics Co. and other global tech companies about 5G options. This week, it settled a global patent-royalty battle with Samsung over mobile communications technology..“I wouldn’t say Huawei is pushing on an open door,” Webster said. “If Huawei gets too haughty, I’m not sure how well that’s going to go over.”.To contact Bloomberg News staff for this story: Gao Yuan in Beijing at ygao199@bloomberg.net;Shelly Banjo in Hong Kong at sbanjo@bloomberg.net.To contact the editors responsible for this story: Robert Fenner at rfenner@bloomberg.net, Edwin Chan.©2019 Bloomberg L.P..With assistance from Bloomberg

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Huawei Goes on Offense in the Battle for Hearts and Minds

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