Huawei has overtaken Ericsson to become the world’s largest telecommunications equipment vendor, even as it faces scrutiny and restrictions from several governments.
The Chinese technology company has encountered resistance in certain markets, notably the United States and Australia, where officials and policymakers have cited security concerns related to the founder’s previous association with the Chinese military. These worries have affected Huawei’s ability to expand in some regions, yet they have not prevented the company from growing its global market share.
This tension resurfaced earlier in the year when Huawei attempted to enter the U.S. smartphone market through a partnership with AT&T. The agreement was abruptly canceled late in the process, reportedly after lawmakers warned U.S. carriers that partnering with Huawei could jeopardize their eligibility for government contracts. Despite such setbacks, Huawei remained the only major network equipment manufacturer to increase its share of the global market last year.
Research firm IHS Markit reported that Huawei’s share of the mobile infrastructure market rose to 28 percent in 2017, up from 25 percent the previous year. The overall global mobile infrastructure sector, however, saw revenue decline to $37.2 billion in 2017 from $43.3 billion in 2016, a drop of 14 percent.
Historical restrictions have shaped the company’s international position. In 2012, U.S. policy effectively barred domestic carriers from purchasing equipment from Huawei and ZTE. The following year, Australia excluded Huawei from contributing to its proposed $38 billion national high-speed broadband project. Similar concerns have continued: for example, U.S. legislators reintroduced proposals aimed at prohibiting government purchases of telecom equipment from Huawei, and reports from February indicated the Australian Defence Force is phasing out Huawei and ZTE smartphones over national security considerations.
Despite ongoing political and regulatory challenges, Huawei’s commercial momentum in network equipment remains notable. Its continued gains in market share reflect demand for its products in many regions and underline the complexity of balancing commercial opportunities with national security concerns.
What do you think about Huawei’s rise to the top of the telecom equipment market? Share your views in the comments.
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