Huawei hasn’t exactly had it easy in the United States. The U.S. government has long considered it and other Chinese companies security threat — so much so that the government reportedly convinced the likes of AT&T and Verizon to end potential deals with the company, and last month news broke that Best Buy would stop selling Huawei phones. Now, the company may stop pursuing the U.S. market, and instead refocus its efforts on markets in which it already exists.
Huawei asserted its focus on existing markets at an annual event in Shenzhen, according to a report from The New York Times. It marks a pretty big change for the company, which has been aggressively going after new markets over the past few years. The Times’ report notes that Huawei recently laid off five of its high-level U.S. employees, including William B. Plummer, who was leading the attempts to smooth over its ties with the U.S. government.
What little business Huawei has in the States could also be on the ropes. The Federal Communications Commission is set to vote on a new law that would block federally subsidized telecommunications companies from working with companies that have been deemed to be a threat to national security.
Huawei isn’t the only company that has been targeted by the federal government. American companies were recently banned from selling components to ZTE, another major Chinese smartphone manufacturer. And, last month, it was announced that the White House would impose tariffs on as much as $60 billion worth of Chinese goods. The tariffs were largely targeted at Chinese tech.
The company’s U.S. woes first started in 2012, when a congressional report noted that its equipment could be used to spy on American citizens or even on the government. As The New York Times notes, Huawei spent $1.2 million on lobbying that year — though in 2017, it only spent $60,000. Since then, things have only gotten worse for the company — and when it began looking for partnerships with U.S. carriers, the government’s stance on Huawei seems to have played a large role in those deals falling through.
Smaller U.S. companies could be affected by Huawei’s refocus towards other markets too. Huawei is a major supplier of telecommunications equipment, and many smaller carriers may use its equipment, meaning they may soon need to find a new supplier.