News coming out of Warsaw, Poland on Friday about another one of Huawei's executives being arrested. There were actually two arrests made in Poland, one was a Chinese citizen who was a former envoy in Poland, before joining Huawei as a senior executive. The second is a Polish citizen, who has held many top government cybersecurity positions. This is all according to the country's Internal Security Agency. The two were charged with spying for China.
The offices of Huawei and Orange – one of the larger wireless carriers in the country, that Huawei is working closely with – were searched, in addition to the homes of both men. There's no word on what was found in those searches, but they did seize documents and electronic data.
This is a pretty big deal for Huawei. After having its CFO arrested in Canada last month, it now has another top executive – though Polish authorities have not yet released his name – arrested is a huge blow to the company. Not only that, but the exec was working with a former cybersecurity expert that worked for the Polish government. That is not a good look at all for a Chinese company who is fighting the image of spying on its customers for the Chinese government.
Huawei's dispute with the US is now spilling over to Europe and around the world
The US has been working to push Huawei out of the country for quite some time now, for a number of reasons. Though the main one is the fear that the Chinese government is using Huawei to spy on people outside of its country. According to some sources that the AP has, US officials have been working with governments across Europe to make their case for why Huawei should be blocked from operating in the country. Huawei was working with Orange on deploying its 5G technology in the country. But now it looks like that deal might be at stake. Increasingly, governments have been siding with the US and blocking Huawei from operating in the country. Recently, Australia banned carriers from using Huawei equipment on its network. Norway is contemplating doing the same.
The director of the Global Public Policy Institute, Thorsten Benner stated that this "is another nail in the coffin of Huawei's European ambitions." After Huawei was all-but pushed out of the US last year, the company shifted its focus to Europe, launching a number of phones in the region, including the P20 and Mate 20 launches happening on that continent. Now that the Europeans are beginning to side with the US, it looks like Huawei's European business might be finished. And this couldn't come at a worse time for Huawei.
Huawei is all-but finished
There have been many accusations that Huawei has been used by the Chinese government to spy on its customers, but after many investigations, nothing has come come up to prove that to be true. Now with this arrest of a Polish security expert, and a senior-level executive, for espionage, it shows that there is some truth to those accusations. Though we will need to wait a bit longer to find out more information about this, and see if there is actually proof. It would be hard to believe that Polish authorities would arrest a couple of Huawei employees on espionage if it did not have concrete proof of it being true though.
In the past couple of years, Huawei has had plenty of trouble getting into new markets and truly expanding. The issues really started in the US last year, when it was set to announce that its current flagship, the Mate 10, was going to be launching on two of the largest carriers in the country – AT&T and Verizon. Only for that to get axed the day before the announcement. This was a big blow to Huawei, and it only got worse as retailers that had been selling its products for years – like Best Buy – announced that it would stop selling Huawei-branded products. It only snowballed from there, throughout 2018. New smartphones from both Huawei and its e-commerce brand, HONOR, have not been available in the US, including the HONOR 8X, which was the successor to the 7X, which was a huge success in the US due to its price. Huawei announced a few weeks ago that it had succeeded in hitting its 200 million goal for 2018, in terms of smartphone shipments. Becoming the second largest smartphone maker in the world. However, these arrests in Poland paint a bleak future for Huawei.