Huawei captures attention along with no. 2 slot

The International Herald Tribune and New York Times had a go at the Huawei story this week after it snared Telenor's LTE business.

To take business away from Nokia Siemens on its Nordic home turf makes for one of the Chinese vendor's sweetest and most important wins. Huawei now has the chance of rolling out a showcase 4G network with a tier 1 European carrier.

The other prompt for the story is Huawei overtaking NSN to become the no. 2 wireless network supplier in Q3 (it's not the second biggest in the industry overall just wireless).

The milestone is worth a shout. In no other hi-tech business is a Chinese firm so close to a leadership position, and not just as a low-end assembly operation.

Like every Huawei story, the IHT/Times piece asks the Huawei question. It gets the Huawei answer from European marketing director Edward Zhou:

“No government or government-linked organizations have any ownership stake,” Mr. Zhou said. “Huawei has no connection to the Chinese military, and none of our directors hold, or has held, any positions with, or serves or has served as a consultant or adviser to, any Chinese government or agency.”

For those who don't know, Huawei was founded by ex-PLA officer Ren Zhengfei - now CEO - and others in 1987. Unlike all of its competitors, including cross-town rival ZTE, it's privately-held. It says it funds its expansion through an annual increase in its capital base and well-supported employee share purchase program. It also has the benefit of a generous $30 billion credit line from a state-owned bank to help customers buy its gear.

Huawei has made the denial about its military connections often enough for it to be quite credible. But in the form put by Zhou, it doesn't rule out the RAND Corporation assertion that Huawei

“maintains deep ties with the Chinese military, which serves a multifaceted role as an important customer, as well as Huawei’s political patron and research development partner.”

Like China itself, Huawei's success, and its secrecy, make it controversial.