Huawei's AT&T USA smartphone deal collapses

Terry Joseph
January 14, 2018

It's a likely good and interesting phone, but AT&T's reported late-inning desire to back out of a deal with the company leaves Huawei in a lurch in a country where the vast majority of smartphone purchases are still done through carriers at subsidized rates. A group of USA lawmakers had earlier written a letter to the US telecommunications regulator expressing misgivings about a potential deal between Huawei and an unnamed carrier, the New York Times reported.

As the USA smartphone market is largely carrier centric, getting a deal with AT&T (or any other United States carrier) would have finally given Huawei a proper presence there.

Huawei faced a similar issue in 2012 when the USA lawmakers claimed there were long-term security risks linked with the company's network equipment and services, leading it to pull out of the U.S. market. But then Yu broke from the script addressing telecom giant AT&T's last minute decision to pull out of a deal to carry Huawei phones in the U.S.

But the deal, which was supposed to be announced at the CES consumer trade show in Las Vegas on Tuesday, was canceled by the USA side at the last minute. In the lawsuit, Huawaei claimed that Samsung Electronics and its affiliates gained huge profits by selling products based on Huawei technology.

In December 2017, Huawei consumer business head Richard Yu told Associated Press that the company will start selling the Huawei Mate 10 Pro through USA carriers next year and will reveal details about the same at CES 2018.

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"Everybody knows that in the USA market over 90 percent of smartphones are sold by carrier channels", he said.

"Two years ago, you couldn't get equipment outside of the carriers", the executive said. It can sell Mate 10 using its own channels, but that may not be a cost-effective proposition.

As early as 2012, the U.S. government conducted a probe into Huawei and another Chinese telecom company, ZTE, on the grounds they represented security threats, but it never provided substantial proof to support its allegations. The letter also cited apprehension regarding a pending deal between Huawei and an unnamed American telecommunications company.

Yu pointed out that the company had already won the trust of other major markets through carriers around the world including China, Europe and Japan, and in an apparent move to address the espionage allegations, he added: "We are serving over 70 million people worldwide".

Other reports by Free-Prsite

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