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NBA-China controversy shows why US needs to be careful about Huawei, FCC commissioner says

The recent NBA-China controversy illuminates why the U.S. must cautiously approach any decision to allow Huawei’s 5G technology into the country, FCC Commissioner Brendan Carr said Thursday on CNBC.

“This NBA issue over the last couple weeks shows how China can leverage all sorts of different levers to exert and have people toe its own political line,” Carr said on “Squawk Alley.”

“So I think that is a threat that that same type of influence could be exerted through Chinese-owned equipment in the U.S. market, which is why we’re taking a very close look at the FCC about whether to do something about that,” he said.

Carr’s comments Thursday came one day after FCC Chairman Ajit Pai expressed similar concerns on Twitter about Huawei, the world’s largest telecom equipment maker. The Chinese company’s products are used by 45 of the world’s 50 largest phone carriers, according to The Associated Press.

The NBA found itself enmeshed in a geopolitical incident after Houston Rockets general manager Daryl Morey expressed his support for Hong Kong protesters. The Chinese government and some businesses in the country responded forcefully, severing ties with the league in various ways.

Earlier this year, the U.S. blacklisted Huawei, and prevented it from doing businesses with American companies — though it was granted a reprieve until November.

U.S. officials accuse Huawei of being a national security risk, alleging its equipment could facilitate the transfer of data to the Chinese government. Huawei has consistently denied the allegations.

Carr, who was nominated to the FCC by President Donald Trump in 2017, said the regulatory agency is invovled in a proceeding “looking at whether to allow funding of Huawei equipment.”

“And at my request we’re also looking closely at whether we need to take equipment out of the network,” Carr said.

Countries around the world are in a race to build out 5G systems, a mobile network that promises fast data speeds and other capabilities to support emerging technologies such as driverless cars.

The U.S. government isn’t the only one to express concerns about Huawei’s potential role in constructing the next-generation infrastructure. Australia and New Zealand have barred the company from their domestic networks.

Those concerns are due, in part, to China’s wide-ranging internet laws, which require technology companies to assist Beijing with loosely defined “intelligence work.”

Interpretations of the laws vary among experts, Carr said.

“There’s a lot of people that say the laws in China don’t expressly authorize them to use this Huawei equipment in the U.S. for spying or other nefarious purposes. There’s been some disagreement about that,” Carr said.

Huawei told CNBC in March that it has never been asked to hand over data to Beijing.

Source: CNBC