Huawei-US clash mars China’s biggest mobile forum
The June 26-28 Mobile World Congress Shanghai, China’s largest forum for the mobile industry, is scheduled to start amid almost daily salvos from the Trump administration aimed at Huawei and other technology companies in the world’s largest mobile phone market.
The U.S. blacklisting of Huawei Technologies Co. and other top Chinese tech companies is making it trickier for some mobile industry professionals to get down to business.
The June 26-28 Mobile World Congress Shanghai, China's largest forum for the mobile industry, is scheduled to start amid almost daily salvos from the Trump administration aimed at Huawei and other technology companies in the world's largest mobile phone market.
The Trump administration's blacklisting of Huawei has dominated global industry discussions in past months, as it threatens to upend supply chains and disrupt the global roll out of fifth-generation technology -- an infrastructure spending spree worth hundreds of billions of dollars. U.S.-Chinese tensions are escalating just as carriers around the world such as China Mobile Ltd. and China Telecom Corp. -- set as keynote speakers at MWC Shanghai -- choose equipment vendors for the 5G networks expected to support technologies from remote surgery to automated factories and driverless cars.
"It's quite a sensitive moment,'' said William Chou, managing partner of Deloitte Private in Beijing, and a scheduled speaker at the conference's key Global Device Summit session. He said it's unlikely Huawei and ZTE will want to show off all their latest devices at MWC Shanghai given how the perception that they are ahead of global rivals has fueled tension.
The focus will instead be on 5G applications and how the vastness of China's market is likely to drive development, Chou said.
"We really need to understand the market, putting aside the political agenda," said Chou. "Business is still business, and particularly in this telco area -- telcos and device manufacturers -- they all need to work together."
The Shanghai event is modeled after a bigger annual industry show in Barcelona. This year's gathering in Spain was also squarely focused on Huawei and China, a nod to the country's rising global importance and to how the Washington-Beijing dispute is creasing the business environment.
"The danger for international companies, especially American companies, is that they are ceding these opportunities to influence the marketplace to non-American companies, which can have knock-on consequences that could be far greater than some had anticipated,'' said Jake Saunders, a vice president at ABI Research, and a scheduled speaker and moderator at the conference.
A two-hour flight away in Osaka, Huawei is also likely to be on the agenda for a meeting between the presidents of China and the U.S. at the G-20 summit.
Last week, President Donald Trump said he had a "very good telephone conversation" with President Xi Jinping and said talks will resume before the two meet at the June 28-29 summit. It's not clear if Huawei was part of their call, but it's an issue Trump himself has said could be on the table.
Trump last year reversed a similar ban on Huawei rival ZTE at Xi's request. Getting that kind of result now would be significant for Xi because the company is exponentially more important than ZTE, said Samm Sacks, cybersecurity policy and China digital economy fellow at New America.
People familiar with the matter on Tuesday said China is considering adding U.S.-based delivery firm FedEx Corp. to its list of so-called unreliable entities. FedEx drew the ire of Chinese officials after Huawei said that documents it asked to be shipped from Japan to China were instead diverted to the U.S. without authorization.
What Bloomberg Intelligence says:
"China's early, widespread 5G deployment would entitle it to the spoils of first-mover advantage, including an edge in setting global standards. An aggressive infrastructure and network build-out will be required for a swift rollout, fueling demand for telecom site resources and equipment."--Denise Wong, BI Infrastructure analyst--Click here for the research
Huawei itself will be out in force at the Shanghai show, based on the lineup at the MWC website this week. Deputy Chairman Ken Hu is scheduled to deliver a keynote and the speaker's list includes 17 names from the company, including Chaobin Yang, president of Huawei's 5G product line; Kevin Ho, president of handsets, and Hua Liang, chairman of the Huawei board.
As delegates and speakers head to Shanghai, Huawei is said to be preparing for smartphone shipments outside China to drop by between 40 million and 60 million this year. That outlook highlights the uncertainty gripping the company, a Chinese national champion accused by the U.S. of aiding Beijing in espionage -- something Huawei has repeatedly denied.
Still, the Shanghai show is on track as planned to draw more than 60,000 attendees from over 110 countries and territories along with about 550 companies, GSMA, the industry group that produces the event, said in an email.
Stockholm-based Ericsson AB, a key 5G equipment supplier, is scheduled to field 11 speakers at the event, including Chief Executive Officer Borje Ekholm and Chief Technology Officer Erik Ekudden. Nokia Oyj, another top gear manufacturer, has eight speakers listed on the program website.
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