US Bans Huawei, ZTE Equipment Sales, Citing National Security Risk

Letterings that form the name of Chinese smartphone and telecoms equipment maker Huawei are seen during Huawei Connect in Shanghai, China, Sept. 23, 2020. (Reuters)
Letterings that form the name of Chinese smartphone and telecoms equipment maker Huawei are seen during Huawei Connect in Shanghai, China, Sept. 23, 2020. (Reuters)
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US Bans Huawei, ZTE Equipment Sales, Citing National Security Risk

Letterings that form the name of Chinese smartphone and telecoms equipment maker Huawei are seen during Huawei Connect in Shanghai, China, Sept. 23, 2020. (Reuters)
Letterings that form the name of Chinese smartphone and telecoms equipment maker Huawei are seen during Huawei Connect in Shanghai, China, Sept. 23, 2020. (Reuters)

The Biden administration has banned approvals of new telecommunications equipment from China's Huawei Technologies and ZTE because they pose "an unacceptable risk" to US national security. 

The US Federal Communications Commission said on Friday it had adopted the final rules, which also bar the sale or import of equipment made by Chinese surveillance equipment maker Dahua Technology Co, video surveillance firm Hangzhou Hikvision Digital Technology Co Ltd and telecoms firm Hytera Communications Corp Ltd. 

The move represents Washington's latest crackdown on the Chinese tech giants amid fears that Beijing could use them to spy on Americans. 

"These new rules are an important part of our ongoing actions to protect the American people from national security threats involving telecommunications," FCC Chairwoman Jessica Rosenworcel said in a statement. 

Huawei declined to comment. ZTE, Dahua, Hytera and the Chinese embassy in Washington did not immediately respond to requests for comment. 

Hikvision said in a statement that its products don't threaten US security. 

"This decision by the FCC will do nothing to protect US national security, but will do a great deal to make it more harmful and more expensive for US small businesses, local authorities, school districts, and individual consumers to protect themselves, their homes, businesses and property," Hikvision said, adding that it will continue to serve US customers "in full compliance" with US regulations. 

Rosenworcel circulated the proposed measure, which effectively bars the firms from selling new equipment in the United States, to the other three commissioners for final approval last month. 

The FCC said in June 2021 it was considering banning all equipment authorizations for all companies on the covered list. 

That came after a March 2021 designation of five Chinese companies on the so-called "covered list" as posing a threat to national security under a 2019 law aimed at protecting US communications networks: Huawei, ZTE, Hytera Communications Corp Hikvision and Dahua. 

All four commissioners at the agency, including two Republicans and two Democrats, supported Friday's move. The agency said it has authority to revoke prior authorizations, but declined to do so. 



Nokia Joins Ericsson in Seeing Signs of Recovery after Mixed Results

FILE PHOTO: A Nokia logo is seen at company's headquarters in Espoo, Finland, May 5, 2017. REUTERS/Ints Kalnins
FILE PHOTO: A Nokia logo is seen at company's headquarters in Espoo, Finland, May 5, 2017. REUTERS/Ints Kalnins
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Nokia Joins Ericsson in Seeing Signs of Recovery after Mixed Results

FILE PHOTO: A Nokia logo is seen at company's headquarters in Espoo, Finland, May 5, 2017. REUTERS/Ints Kalnins
FILE PHOTO: A Nokia logo is seen at company's headquarters in Espoo, Finland, May 5, 2017. REUTERS/Ints Kalnins

Finnish telecom equipment supplier Nokia on Thursday reported a 9% rise in third-quarter operating profit on cost cuts, and echoed rival Ericsson in seeing demand recovery in some areas.
However, quarterly net sales fell 8% to 4.33 billion euros ($4.70 billion), missing estimates of 4.76 billion euros due mainly to lower sales to India. That sent its shares down 3%, Reuters said.
Both Nokia and Ericsson said North America has started to show signs of growth after years of weakness, but Nokia's market share in the region had dropped after losing contracts with Verizon and AT&T over the years.
"We have seen a really bad cycle... Now that decline is over and it is starting to gradually recover, which is good, but it (telecom) will never be a huge growth market," CEO Pekka Lundmark said in an interview.
He cautioned that growth was happening more slowly than earlier expected.
"North America has started to show pretty good signs, and we had strong growth in Q3 in network infrastructure," Lundmark said.
Nokia's total addressable market in telecom stands at around $84 billion.
To look for growth, Nokia has been targeting the data center and defense sectors, splurging $2.3 billion to buy US optical networking gear maker Infinera in June to target data center operators.
"That's where the growth will come from, and that growth is starting already," Lundmark said.
Demand from Indian clients, which has dropped significantly this year, is also recovering after Nokia last month got a big contract from Vodafone Idea and is expected to get another from Bharti Airtel .
"India will return back to growth next year," Lundmark said.
Comparable earnings before interest and tax rose to 454 million euros, beating the 424 million euros expected by analysts in an LSEG poll.

Nokia maintained its full-year profit outlook of 2.3 billion to 2.9 billion euros, but said it was currently tracking within the bottom half of that range.