Huawei unfazed by Motorola charges
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Chinese telecom equipment giant Huawei Technologies will continue to pursue expansion opportunities in the US market despite a recent lawsuit filed by mobile phone maker Motorola against it for allegedly stealing trade secrets.
The Chinese company had been planning to make inroads into the American markets through acquisitions. Nokia Siemens Networks (NSN) purchase of the wireless network assets from Motorola for $1.2 billion, and Ericsson's $1.13 billion acquisition last year of Nortel Networks' mobile unit were some of the deals that the Chinese company was believed to be interested in.
Analysts said though Huawei has not been successful in its efforts so far, it may gain some of the customers impacted by the NSN takeover.
"I think Motorola's plan to file a lawsuit is a marketing tactic," said Wang Yuquan, senior consultant with research firm Frost & Sullivan China. "In fact, it is the right time for Huawei to expand in the US as the NSN acquisition will impact many Motorola customers.
The US company on Wednesday said Huawei stole confidential information about its cellular network equipment. Motorola said one of its former staff engineers, who now works with a Huawei reseller called Lemko had shared information about a new transceiver and other Motorola technology with Ren Zhengfei, the founder of Shenzhen Huawei.
"The complaint is groundless and utterly without merit," said Huawei in an email statement to China Daily. "Huawei has no relationship with Lemko, other than a reseller agreement. We will defend ourselves against these baseless allegations," it said.
Huawei had reported a 19 percent growth in revenues last year to 149.06 billion yuan from 125.22 billion yuan, and had surpassed NSN as the world's second largest telecom gear maker, according to a report by research firm Gartner.
However, Huawei's expansion in mature markets like the United States and Europe has often faced stiff opposition due to security concerns. In 2008, the US government vetoed Huawei's effort to buy networking company 3Com Corp.
"The US market is important to companies like Huawei. I think we will now see more expansion by Huawei in the American market," said James Lei, director from research firm In-Stat China.
Huawei on Wednesday refused to comment on its expansion plans in the United States. But the company is believed to have hired John Bellinger, former legal adviser to the United States Secretary of State, to help its expansion in the US.
Huawei had earlier said it expects a 20 percent growth in business due to advancements in mobile broadband across the world.
