Huawei, ZTE Spat Heats Up 华为中兴之争升级

By newsdoug on June 8, 2011

Industry watchers are undoubtedly amused at the ongoing spat between crosstown Chinese rivals Huawei Technologies and ZTE (HKEx: 763; Shenzhen: 000063), which could potentially weaken these two rising giants unlike any competition from worried global players like Ericsson (Stockholm ERICb) or Alcatel Lucent (Paris: ALU). In the latest twist of this saga, which began when Huawei sued ZTE in April (previous post), ZTE has launched a new round of legal action against Huawei claiming infringement of its patents in the emerging 4G LTE space. (English article) This latest action comes after Beijing tried, apparently unsuccessfully, to mediate a truce in this unfolding drama between two of its most promising tech companies, which both rely heavily on exports. (previous post) Huawei-ZTE dogfight heats up This new lawsuit could prove potentially damaging to Huawei if it goes forward, as the legal action aims at 4G — expected to be a major growth driver for both companies as telcos upgrade to next-generation LTE networks. What’s more, this lawsuit aims to put the brakes on a trial LTE network that Huawei is currently building for China Mobile (NYSE: CHL; HKEx: 941) in both companies’ headquarters city of Shenzhen. While this kind of back-and-forth lawsuits isn’t exactly helpful for business, it’s quite common in the West and thus it’s refreshing to see it happening in China where Beijing more often urges companies to try to live together in harmony. I’m guessing Beijing may still try to mediate this dispute, aiming to keep it from completely spinning out of control and potentially hobbling two of its biggest export superstars.

Bottom line: The latest escalation in the Huawei-ZTE dispute shows this conflict is spinning out of control, which could prompt Beijing to soon step in and impose a settlement.

毫无疑问，行业观察人士对华为和中兴通讯<000063.SZ> <0763.HK>之间的持续争端感到很好奇。与爱立信<ERICb.ST>或阿尔卡特-朗讯<ALUA.PA>等海外对手发起的竞争不同，华为和中兴之间的争执可能让他们两败俱伤。这场争端开始於4月份，当时华为将中兴告上法庭。如今中兴对华为发起了新一轮法律行动，称华为侵犯了其在4G长期演进技术(LTE)领域的专利。此前中国政府曾尝试调解双方的争执，但看来未能奏效。如果这场新官司继续打下去，华为可能会受到相当程度的冲击，因为这场控诉是针对4G的，而随着电信运营商升级至下一代LTE网络，上述技术料将成为两家公司未来增长的主要驱动力。而且，中兴的诉讼还旨在叫停华为正在深圳为中国移动<0941.HK> <CHL.N>建设的LTE测试网络。虽然这种官司对生意没什麽好处，但其实它在西方很普遍。而看到这种情况也发生在政府倾向於要求企业之间保持和谐的中国，倒是挺让人感觉新鲜的。我估计中国政府还会继续试图调停，以让事态不至于失控，避免这两家出口明星企业自相残杀。

一句话：华为和中兴之争升级，说明这场冲突面临失控危险，而中国政府可能会很快介入，以促成双方和解。

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