AT&T drops Huawei amid security worries
SHANGHAI— With an advanced screen, a special artificial-intelligence microchip and an eye-popping price, the newest smartphone from Huawei Technologies was meant to show Americans what China can do with technology.
Instead, Huawei’s push to sell the phone in the United States has suddenly lost a powerful backer — and the push has attracted some unwanted scrutiny from Washington.
AT&T walked away from a deal to sell the Huawei smartphone, the Mate 10, to customers in the U.S. just before the partnership was set to be unveiled, said two people familiar with the plans, who spoke Tuesday on the condition of anonymity because the discussions were not public. The Wall Street Journal reported earlier that AT&T had changed plans.
The reasons that led to AT&T’s shift were not entirely clear. But last month, a group of lawmakers wrote a letter to the Federal Communications Commission expressing misgivings about a potential deal between Huawei and an unnamed U.S. telecommunications company to sell its consumer products in the United States. It cited long-standing concerns among some lawmakers about what they said are Huawei’s ties to the Chinese government.
The letter said Congress has “long been concerned about Chinese espionage in general and Huawei’s role in that espionage in particular.”
While the letter did not mention AT&T, its pending deal to sell the Huawei smartphone in the United States had been widely reported.
Fletcher Cook, a spokesperson for AT&T, declined to comment.
Huawei, a private company, has long denied that it presents security risks. In a statement, Huawei said that it had delivered “premium devices with integrity globally and in the U.S. market” over the past five years, adding that it would introduce new products for the U.S. market.
The last-minute disruption is the latest in a long line of setbacks for Huawei, which has struggled for years with political opposition to its efforts to tap the hugely valuable U.S. market. More broadly, it underscores a deepening political rift over issues of technology, user privacy and security — a rift that adds to a brewing trade dispute between the world’s two largest economies.
Huawei has been counting on the Mate 10 to compete with Apple’s high-end iPhones, in a test of the potential appeal of a Chinese brand in the U.S. Huawei has long sold budget phones, but some Mate 10 versions cost $900 (U.S.) or more without subsidies from phone carriers.
Huawei sells smartphones in the U.S., but it does not have smartphone deals with any of the major wireless carriers in the country. Those carriers — Verizon, AT&T, Sprint and T-Mobile — dominate the market, making it more difficult for Huawei to get a foothold in the country.