Despite its seemingly miraculous recovery, ZTE is by no means off the hook. The Chinese telecommunication giant risked losing its Android license after the US Department of Commerce banned it from using all technology based out of the US. Billions of dollars of fines later, the company finally got respite and was able to resume operations in the US, albeit under the watchful eye of regulators. Earlier, a bill was proposed by a senator that called for all a ban on all ZTE and Huawei devices by all government employees and contractors.
Today, President Trump signed the bill into action. Effective immediately, ZTE and Huawei devices cannot be used in components or services that are “essential” or “critical” to the system they’re used in. Some components are still allowed, so long as they cannot be used to route or view data. The bill also instructs several government agencies to assist businesses that will have to change their technology as a result of the ban.
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Huawei calls the ban ‘ineffective, misguided, and unconstitutional.’
In a statement to The Verge, Huawei stated that the ban would increase costs for consumers and businesses and that it failed to “identify real security risks or improve supply chain security.” Huawei and ZTE have received a lot of flak from the US government over suspicions of espionage. ATT was supposed to partner up with Huawei to develop 5G networks but scrapped the plan citing ‘political pressure’. Even the Huawei Mate 10 was dropped by the carrier for similar reasons. It is unclear if Huawei will challenge the decision legally at this point.
The bill could have a major impact by forcing many companies that want to work with the government to remove the Huawei and ZTE components they’re already using. The move will likely affect ZTE more than Huawei, as the latter has a wide range of products retailing globally and US government employees are little more than a drop in the bucket. The road to recovery for ZTE is difficult and such hinderances only make it worse.
Source: The Verge
