Beijing Help Undermines Huawei Image Drive 中国商务部替华为出面或适得其反

By newsdoug on April 9, 2012

At least it wasn’t the Public Security Bureau. That’s what the public relations people at Huawei Technologies are probably saying as they come back to work this morning, after China’s Commerce Ministry spoke out late last week in the company’s defense after Australia’s government forbid Huawei from bidding to help build a new high-speed network due to security concerns. (Chinese article) Huawei has repeatedly run into similar concerns over the past year, hitting another brick wall in the US in 2011 when it tried to bid for contracts to help upgrade that nation’s emergency communications networks. (previous post) The problem in both cases is largely related to image, as many western politicians see Huawei as a spying arm of Beijing and are thus reluctant to let it build sensitive communications networks in their countries. The background of Huawei’s media-shy founder Ren Zhengfei hasn’t helped the situation and is even the source of many of the image problems, since Ren himself was a former engineer in the People’s Liberation Army before founding Huawei more than 2 decades ago. Huawei has made repeated attempts to distance itself from Beijing, with Ren himself pointing out in a recent speech that he was rejected for Communist Party membership many years ago. After the latest Australian setback late last month (previous post), Huawei even volunteered to reveal its source code if it could re-enter the bidding, in a move to ease the security concerns. (Chinese article) But from a public relations perspective, this latest defense of the company by China’s Commerce Ministry was probably the last thing that Huawei wanted or needed to make its case to the Australian government of its independence from Beijing. From a purely perceptional point of view, having a major government agency speak out on your behalf will hardly help to convince people of your independence from government support or control. As I said at the beginning of this post, perhaps Huawei can take some consolation in the fact that the Commerce Ministry spoke out on their behalf and not the Public Security Bureau itself, which is responsible for policing China’s telecommunications networks. But if Huawei really wants to convince the world of its independence from Beijing, its public relations department might want to make a low-key call to the Commerce Ministry and other government departments and politely ask them not to speak out too much on its behalf when its bids for global contracts fail. The Commerce Ministry remarks aside, I actually think Huawei has handled the Australia setback relatively well, remaining quiet despite the rejection, unlike its outspoken reaction when it was rejected for the US contracts last year. It needs to keep up this low-key approach, including good-will measures like revealing its source code to skeptical governments, and continue the effort without Beijing’s assistance if wants to eventually break into these lucrative but difficult markets.

Bottom line: Huawei needs to conduct its campaign to break into western markets by itself without government help if it wants to prove its independence from Beijing.

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