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Verizon won’t sell Huawei phones due to US government pressure, report says

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The Chinese smartphone company is becoming a pariah among carriers

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Verizon won’t sell any Huawei phones, including the new flagship Mate 10 Pro, because of pressure from the US government, anonymous sources told Bloomberg yesterday. Verizon declined to comment, and Huawei did not immediately respond.

Huawei has been trying to make a big push into the US this year but has found its efforts stymied by the US government over concerns that the Chinese company could be a security threat. Earlier this month, AT&T pulled out of a deal with Huawei to sell the Mate 10 Pro after receiving similar pressure. While Huawei sells unlocked phones that can still work on Verizon and AT&T networks, having its phones sold by a major US carrier would have allowed it to reach more consumers than before and raise its reputation in the US.

A day after AT&T’s decision was made public by media reports, Huawei’s consumer products CEO Richard Yu shared his reaction during a CES keynote. He said that American consumers were the ones who missed out when the deal between Huawei and AT&T fell through. “It’s a big loss for us, and also for carriers, but the more big (sic) loss is for consumers, because consumers don’t have the best choice,” he said. “Everybody knows that in the US market that over 90 percent of smartphones are sold by carrier channels.”

The US has long been suspicious of Huawei, despite Yu’s arguments that Huawei has “proven our quality ... proven our privacy and security protection.” Huawei first drew US attention in 2003 when it was sued by Cisco under accusations that it stole source code to build its network routers. Huawei denied those claims, and Cisco ultimately dropped the suit as long as Huawei modified its product line, discontinuing some products.

Suspicions were raised again in 2013 when former CIA and former NSA boss Michael Hayden claimed that he was aware of hard evidence that Huawei had spied for the Chinese government. In an interview with the Australian Financial Review, Hayden said Huawei had “shared with the Chinese state intimate and extensive knowledge of the foreign telecommunications systems it is involved with,” although he did not detail what the evidence was.

Last month, 18 lawmakers signed a letter asking FCC chairman Ajit Pai to look into Huawei’s plans to sell consumer products in the US, citing concerns from congressional intelligence committees. The FCC did not immediately respond to a request for comment.

To combat fears of Chinese spying through devices from Huawei and ZTE, another Chinese phone maker, Rep. Mike Conaway (R-TX) introduced a bill called the Defending US Government Communications Act, which would ban US government agencies from using phones and equipment from the two companies. “If a potential adversary is making the systems and software that you use,” P.W. Singer, author of Cybersecurity and Cyberwar: What Everyone Needs to Know, told The Verge, “you don’t just have dependency, but also potential vulnerability that can be exploited not just now, but years into the future.”

This week, a leaked PowerPoint presentation from the Trump administration revealed a proposal to build a nationalized 5G network, in part to ward off possible Chinese surveillance threats. “China is the dominant malicious actor in the Information Domain,” the presentation stated.