Huawei CEO Ren speaks out, denies involvement in U.S. cyber security issues

Huawei CEO and founder Ren Zhengfei for the first time ever spoke with the news media, declaring that the Chinese vendor is not connected to U.S. cyber security concerns about China.

Ren has not spoken on the record to the media since Huawei was founded 26 years ago, a stance that fueled criticism that the private company was not being transparent enough despite its growing influence as the world's No. 2 infrastructure vendor behind Ericsson (NASDAQ:ERIC), with $35.5 billion in sales. The company has also grown to be the world's No. 5 smartphone maker by volume.

Despite its success, Huawei has been dogged by criticism, especially from U.S. politicians, that the company poses a security risk, charges Huawei has repeatedly and flatly denied.

Ren spoke with four local news outlets during a visit to Wellington, New Zealand. However, his comments on the U.S. market are sure to be parsed: "Huawei equipment is almost non-existent in networks currently running in the U.S. We have never sold any key equipment to major U.S. carriers, nor have we sold any equipment to any U.S. government agency," Ren said, according to a Huawei statement about the media briefing, as reported in the Wall Street Journal. "Huawei has no connection to the cyber security issues the U.S. has encountered in the past, current and future."

Ren also addressed his time in the Chinese Communist Party. According to the Journal, which cited a Fairfax New Zealand article, Ren said he joined the Communist Party in 1978 at a time when all "exceptional people" would be expected to do so.

"Back in 1978 it was not yet the time for China to open itself up to the outside world…..At that time my personal belief was to work hard, dedicate myself or even sacrifice myself for the benefit of the people. Joining the Communist Party was in line with that aspiration," he was quoted as saying.

Ren's comments come days after the U.S. Department of Defense, in its annual report to Congress on Chinese military capabilities, explicitly identified the Chine's military as the source of cyber-attacks against American government agencies and military contractors, which China denied.

A report from the House Permanent Select Committee on Intelligence recommended in October that the United States block acquisitions and mergers involving Huawei and fellow Chinese vendor ZTE, and it also recommended that the U.S. government and U.S. companies avoid using equipment from the two Chinese companies. Huawei and ZTE pushed back aggressively against the report's conclusions, and have repeatedly said they do not pose a security threat and have no ties to the Chinese military or government. The Chinese government had earlier also denied the claims and has suggested that the report could set back relations between the United States and China.

In April 2012, Huawei set up a rotating CEO system under which the 68-year-old Ren splits up the duties of the CEO with a panel of top executives for six-month stints. The three executives are Ken Hu, Guo Ping and Eric Xu; none of them is related to Ren. Ren has reportedly said that the person who succeeds him as CEO will not be a member of his family.

Huawei has won contracts to supply LTE gear to Telecom New Zealand. Ren reportedly said New Zealand is one of Huawei's most important strategic markets and is "very valuable" to the company, according to ZDNet.

For more:
- see this Reuters article
- see this WSJ article (sub. req.)
- see this BBC News article
- see this AP article
- see this Forbes article

Related Articles:
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Huawei sets sights on gaining smartphone market share in Europe
Report: EU's planned probe into Huawei, ZTE has weak support
Huawei ships 32M smartphones in 2012, misses its expectations
China lashes out at U.S. over Huawei/ZTE report, cites 'Cold War mentality'

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