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Huawei controversy could benefit resellers

01 May 2012

With the New Zealand and Australian governments lining up on opposing sides of the Huawei debate, will local resellers feel the fallout?

Huawei’s exclusion from Australia’s national broadband network (NBN) – and the resulting political fallout in New Zealand with the two governments lined up on opposing sides – are not expected to have any impact on the local channel according to Geoff Johnson, Gartner research vice president.

However, Johnson says the flare up is a good reminder that all customers need to look at their own security – and opens the doors for the reseller channel to proactively target the business.

While Huawei has been banned from participating in Australia’s NBN, the company is heavily involved in New Zealand’s Ultrafast Broadband initiative. Last month Prime Minister John Key faced a grilling in Parliament with claims that a security agencies report in 2010 effectively stated ‘there were no mitigation measures that would totally counteract the compromising of our broadband infrastructure should Huawei be given the contract’.

Locally, Huawei has remained quiet on the debate, other than reiterating its plans to continue growing ‘this area of our business in New Zealand’.

The networking giant recently posted a net profit of 11.6 billion yuan for the 2011 calendar year, with sales increasing nearly 12% on 2010 to CNY 203.9 billion.

Johnson says while there has been plenty of publicity, Australian carriers and channel partners have taken a measured approach. “It’s just ho-hum to them. They see it as a government issue, rather than something impacting them.

“Most see [the Australian situation with the NBN exclusion] as Australia providing support for the United States,” Johnson says. The United States government has long been concerned about Huawei because of ‘uncertainty’ over its relationship with the Chinese government.

No particular issues

“For the New Zealand channel I don’t see any particular issues,” he says.

In fact, Johnson says the debate provides a further opening for resellers to discuss security with customers.

“There’s a lot of opportunity for the New Zealand reseller channel to work with customers to bring them up to speed on end-to-end security issues. Customers will be more aware now and will be seeking the information. You can provide the knowledge and resolution.”

Johnson says any companies with a professional services arm should ‘be aggressive in promoting best practice’ following on from Huawei publicity.

“This is just one of those wake-up calls we get from time to time that remind us all to be aware of security needs.

“Every company needs to be selfish and focus on their own end-to-end arrangements. Over time, we will all have usage of all global providers, be they American, Chinese, Israeli...” Johnson says, adding that it’s interesting to note that most people don’t think twice about sticking a dongle in their computer – “And where do you think they come from?”

He says resellers should be reminding customers of the need to have their network certified.

“In the United Kingdom, the British government was using Huawei for its equivalent of the NBN and some security agencies complained about the amount of work involved in auditing every device in the network. But it’s something you’re obliged to do.”