updated 07:33 pm EDT, Wed October 10, 2012
New allegations come in wake of House committee report
Following the release of a report from the House Intelligence Committee, the panel investigating possible security concerns stemming from Huawei and ZTE equipment use now claims to have received "dozens and dozens" of calls from former employees and customers of the two companies. These calls, according to Reuters allege suspicious equipment behavior, especially on the part of Huawei's equipment. The development is likely to result in intensified scrutiny of the two Chinese companies' dealings, further hampering their efforts to make gains in the US telecom market.
Reuters cites an unnamed congressional staffer in its report, and the staffer goes on to say that Huawei and ZTE can expect that the committee will not be turning its eye from them any time soon.
Suspicious and unusual occurrences connected to the two companies include the emergence of a virus on a network node of pre-paid wireless provider Cricket. Cricket uses Huawei equipment to deploy its network, and the virus emerged while Huawei equipment in use at the node. Initially, there were concerns that information had been transmitted to China without authorization, but Huawei notes that independent security analyses pointed to a Wi-Fi access point -- one unaffiliated with Huawei -- as the source of the infection. Huawei also notes that the committee was aware of these facts and misrepresented them in the course of its investigation.
Earlier this week, a draft report from the House Intelligence Committee argued that Huawei and ZTE were subject to influence by the Chinese government. The report emerged from 11 months of research, including testimony from ZTE officials and continual probing of the ties between the two companies and the Chinese Communist Party.
The two companies have also come under scrutiny in the European Union, where regulators charge that ZTE and Huawei receive improper subsidies from the Chinese government, allowing them to undercut their non-Chinese competition considerably.
Huawei and ZTE have continually asserted their innocence of any espionage allegations. The committee's report and ongoing investigation, they say, serves only to harm relations between the US and China.