Huawei, ZTE a security threat: US

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The Chinese telecommunications equipment supplier Huawei Technologies Co. Ltd. and China's ZTE Corp, both based in Shenzhen, China, are likely to be branded a threat to United States' national security by the U.S. House of Representatives.

Huawei is now the largest telecommunications equipment maker in the world. [file photo]

The House of Representatives U.S. Intelligence Committee will release the results of a year-long investigation into the alleged security risk posed by Huawei and ZTE on Oct. 8.

In truth, the die was cast even before the results were announced. Mike Rogers, the chairman of the committee, said on a CBS News interview aired on Oct. 7 that Huawei's products could open the door to spying.

"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," Mike Rogers said.

Both Huawei and ZTE have rejected charges that their quick expansion into the U.S. poses a security risk and argue their operations are not associated with the Chinese government.

Huawei spokesman and vice president of external affairs based in the U.S. William Plummer said in response that it was "globally trusted and respected."

"The security and integrity of our products are world proven," William Plummer said in an email. "Those are the facts today. Those will be the facts next week, political agendas aside."

ZTE says that its status as a publicly traded company has ensured that it is transparent about its practices with the public and the intelligence committee.

"ZTE has set an unprecedented standard for cooperation by any Chinese company with a congressional investigation," said David Dai Shu, the company's director of global public affairs. "ZTE equipment is safe."

Multiple reports have suggested that Huawei has reached out to investment banks to explore the possibility of an initial public offering. The move is seen as a way for the company to become more transparent and assuage security concerns as part of an effort to win more contracts in the United States. However, no decision on whether to do so has been made.

"We haven't ruled out the possibility of a listing," a source close to the company told Reuters.

"We've always been in touch with banks, but I don't think anything has been decided." William Plummer told the Wall Street Journal that Huawei doesn't comment on market rumors, but "if and when such a thing happened it would be when it makes commercial sense."

Huawei is now the largest telecommunications equipment maker in the world, and No.6 handset maker and ZTE is the world's fifth largest telecom equipment vendor by revenue.

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