Chinese Smartphone giant has desperately said the company is not able to close the deal with any of the US carriers in order to sell its new smartphones.
Previously it was also reported that Chinese manufacturer is in talks with AT&T to sell its new flagship Huawei Mate 10 Pro but the talks seem to end unsuccessfully. A letter seen by Reuters confirms that politicians submerged the deal over the security concerns.
This is one of the latest and widely known snubbing examples of Chinese companies struggling to do business in the US market. Not only this, things are being politicized now especially for Asian countries including China and Russia.
Last week, Alibaba’s digital payments company “Ant Financial” lost the deal to buy out “Moneygram” a money transfer company for $1.2bn.
Since Donald Trump came to power, this is the first high profile deal which was rejected by the country. Now it seems the Chinese companies will face more problems in doing business in the United States.
The Challenges in the US
Chief Executive Officer (CEO) Huawei told previously at the CES Tech Fair in Las Vegas that the company plans to collaborate with US carrier to sell its phones in the market, which is, unfortunately, has turned down now by the US government. However, Huawei CEO did not comment on the deal why it was unsuccessful, but he said it is a big loss for consumers not to have a choice to get hands on the best devices—According to Techcrunch report.
The phone Huawei Mate 10 Pro would still be available in the US via retail stores in order to compete with high-end devices of Apple and Samsung. Strategically, the deals provided with carriers like AT&T and T-Mobile are really important for smartphone manufacturers because most of the purchasing in the US is done via carriers. Users only get deals on data and voice packed with latest handsets. Despite the challenges for Huawei in the US market, the company says “We are still committed to this market and we will remain committed in the future.”
US parliament high echelon officials were involved to scupper the deal, AT&T was pressurized to pull out of the deal when 18 members of US Senate and House Intelligence committees signed a letter and sent to regulators showing concerns over the security that Chinese companies are involving in US Telecoms.
This could be a genuine concern for the national security from one side but it seems US government is playing double standards here. The security threat could be from anyone and anywhere in the world, then why the US parliament is allowing Samsung which is the South Korean manufacturer and other countries to sell their phones in the market?
The letter notes worries over “Chinese espionage in general, and Huawei’s role in that espionage in particular”.
The concern is not new, in 2012, US Congress said Huawei and ZTE should be restricted from any mergers and acquisitions in the country because the two companies pose a threat to national security.
Huawei has become the world’s 3rd largest smartphone manufacturer after Samsung and Apple.