Huawei and ZTE come under fire from FBI, CIA, NSA

It isn’t exactly a secret that the US government has a certain hesitancy when it comes to phones made by Chinese companies, but today, we’re seeing some top security official state that apprehensiveness outright. Many top security officials have come out and recommended that Americans avoid buying phones made by Huawei and ZTE. Such a recommendation won’t really come as much of a shock, and may even do something to solidify some recent rumors we’ve been hearing.

According to CNBC, six of the country’s top intelligence chiefs have advised the Senate Intelligence Committee that Americans shouldn’t buy phones made by Huawei or ZTE. That roster of intellgence chiefs includes some high profile people, including the heads of the FBI, CIA, NSA, and the US director of national intelligence. While these recommendations have existed in the past for those who work for the government, this is the first time that the agencies have advised private citizens on the matter.

By using these phones, FBI director Chris Wray argues, it opens up the potential for “foreign governments that don’t share our values to gain positions of power inside our telecommunications networks.” Some of the downsides Wray covers are things like undetected espionage, or the capacity to “exert pressure or control over our telecommunications infrastructure.”

Huawei, for its part, tells CNBC that it “poses no greater cybersecurity risk than any ICT vendor.” The company also noted that it is “trusted by governments and customers in 170 countries worldwide,” suggesting that this worry is unique to the US.

Huawei has been having a tough time trying to break into the US, and recent rumors claim that the US government is at least partly to blame. Last month, AT&T abruptly called off a deal to carry Huawei phones in its stores, and later reports stated this was due to pressure from the US government. We also recently heard that Verizon had dropped a similar deal, leaving Huawei to sell phones unlocked in the US.

Whether or not Huawei and ZTE deserve this apprehension is up for debate, but for now, it seems the US government isn’t interested in the perceived risks associated with having those companies gain a foothold in the market. We’ll see if that changes anytime soon, but given the looming threat of cyberwarfare, US security agencies are likely to stay the course for now. Stay tuned.

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Verizon Kills Plans For Selling Huawei Phones Following US Government Pressure

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Huawei has just experienced another setback in its efforts to partners with a major U.S. wireless carrier to sell its smartphones. Verizon was in discussions to sell smartphones from the Chinese OEM, but those talks have hit a brick wall. Huawei ran into similar trouble with AT&T earlier this year.

According to a new report from Bloomberg, U.S. lawmakers put pressure on both AT&T and Verizon to scrap any plans to sell Huawei smartphones to Americans. According to the government officials, there are serious concerns regarding Chinese spying and the possibility that backdoors could be installed on devices.

For its part, Huawei officials acknowledge that breaking into the U.S. market is a bit harder than previously expected. “The U.S. market presents unique challenges for Huawei, and while the Huawei Mate 10 Pro will not be sold by U.S. carriers, we remain committed to this market now and in the future,” said the company in a statement earlier this year following AT&T’s decision for to pull out of a deal.

At CES 2018, Huawei CEO Richard Yu reflected on his company’s troubles with U.S. wireless carriers. “Everybody knows that in the US market that over 90 percent of smartphones are sold by carrier channels,” said Yu. “It’s a big loss for us, and also for carriers, but the bigger loss is for consumers, because consumers don’t have the best choice.”

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Yu went on to explain that Huawei has had to prove itself time and time again since its inception. “We win the trust of the Chinese carriers, we win the trust of the emerging markets,” said Yu. “And also we win the trust of the global carriers, all the European and Japanese carriers.” Unfortunately for Huawei, the U.S. government isn’t receptive to its advances.

Despite striking out with America’s two largest wireless carriers, the company is not completely out of the game. Major U.S. retailers including Best Buy, Amazon, Microsoft, Newegg, and B&H will sell the Mate 10 Pro starting on February 18th. Pre-orders for the smartphone will kick off on February 4th.

Back in 2012, both Huawei and ZTE were labeled as security threats to the U.S. by the House Intelligence Committee. “Neither company was willing to provide sufficient evidence to ameliorate the Committee’s concerns. Neither company was forthcoming with detailed information about its formal relationships or regulatory interaction with Chinese authorities,” wrote the congressional panel at the time.

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“Huawei, in particular, failed to provide thorough information about its corporate structure, history, ownership, operations, financial arrangements, or management. Most importantly, neither company provided sufficient internal documentation or other evidence to support the limited answers they did provide to Committee investigators.”

More recently, the Trump administration has reportedly tossed around the idea of a nationalized 5G wireless network. The reason for such a network would be to fend off threats from countries like China and Russia. Cyberwarfare and cyberespionage are increasingly becoming problems in our always-connected world, and countries are looking for additional ways to fortify their defenses.

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Do ‘National Security’ Threats Signal The Beginning Of The End For US-China Trade Relations?

Photographer: Qilai Shen/Bloomberg

The Trump administration is gearing up for renewed confrontation with China on trade-related issues. Most observers have focused their attention on the threat of increased tariffs or the “renegotiation” and dismantling of existing free trade agreements.

In 2018, Washington could unleash a host of damaging policy weapons that have nothing to do with customs duties . Instead, the theme of U.S. “national security” will be invoked to monitor, control and block a broad range of commercial activities between Chinese and American entities.

There are a variety of show-stopping situations that could transpire—literally from one day to the next—which could disrupt cross-border commerce:

  • Blocked foreign acquisitions or deals with U.S. “nationally sensitive” firms and industries
  • Increased sanctions against individuals, companies and countries
  • New export licensing requirements for a growing list of seemingly benign materials and components.

These scenarios fall under the lengthening shadow of “SIES”—strategic industries and economic security. The U.S has more than a dozen federal agencies enforcing hundreds of SIES regulations and restrictions.

Any multinational enterprise that fails to realize the gravity of these measures will have calamity visited upon it. Just ask ZTE, the Chinese telecoms company that recently paid $892 million to various U.S. government agencies. ZTE violated export controls and sanctions regulations on shipments of U.S. origin materials to Iran and N. Korea.

Despite being major trading partners—with all of the upside for business and investment—Beijing and Washington are both pursuing primarily self-serving agendas. It’s an unpleasant truth, but the national security dimension of the relationship is destined to intensify. Key technology sectors have been pulled into the fray of the China-U.S. rivalry, with spill over into the realms of cyber warfare, espionage and the militarization of space.

The consequences of the growing U.S.–China power rivalry are deadly serious . Recent reports of a spy-killing campaign in China, instigated by a CIA-agent-turned mole, are a sobering reminder of this new reality.

U.S. blocks Huawei and Ant Financial business deals

In the latest round of blocked Chinese business ventures in the U.S., the Federal Communications Commission (FCC) forced AT&T, the U.S. telecoms giant, to back out of a major deal with the Chinese smartphone maker Huawei. The deal would have made Huawei a major supplier of phones to AT&T’s customers—and opened up a major new market for Huawei.

(Photo by David Becker/Getty Images)

Huawei, is the world’s largest maker of telecommunications equipment. But it has long been suspected by U.S. lawmakers to be linked to Beijing’s economic and political policy apparatus. The founder of Huawei, Ren Zhengfei, was an officer in the Chinese military. Although Huawei is a private company, most U.S. authorities are convinced that virtually all big Chinese companies have murky ties to Beijing’s power circle. The possibility of millions of American consumers using Chinese-made phones with secret “back doors” and data tracking features written into the operating systems was enough to kill the deal.

Since 2012, Huawei had been blocked from selling network equipment to U.S. telecommunications carriers, so the latest rebuff on telephone sales has dealt a major blow to the company, essentially locking it out of the world’s largest economy.

Also in recent weeks, Ant Financial, was blocked from purchasing MoneyGram , the U.S. money-transfer company. The deal, worth $1.2 billion, was killed by the committee of foreign investments in the United States (CFIUS), on the grounds that Chinese interests would have access to the private data of millions of Americans.

More on Forbes:Alibaba’s Failed MoneyGram Deal Shows How China’s Payment Wars Are Spilling Over Into U.S.

Earlier in the year, U.S. government agencies were barred from buying cybersecurity software from the Russian firm Kaspersky Lab, the result of growing fears about pervasive Russian spying in the U.S.

Security fears everywhere

For Washington, espionage, and sabotage are on equal footing with the fear of losing competitive advantage to foreign adversaries in critical sectors, particularly in semi-conductors, AI and robotics.

Last year, the Trump administration took its first major action when it blocked Canyon Bridge Fund—with ownership by Chinese state-back entities– from buying Lattice Semiconductor Corporation, a leading edge American tech company. This trend will continue into 2018, and probably intensify, as the Chinese have increasingly targeted high-tech firms for acquisition.

Related:As Chinese Investment In U.S. Increases, So Too Does Scrutiny

The Chinese are said to have reacted to Edward Snowden’s divulgence of U.S. government surveillance activities in China by excluding U.S. vendors Cisco and Apple from approved government supplier lists.

(Photo by Arif Hudaverdi Yaman/Anadolu Agency/Getty Images)

Beijing, of course, is no stranger to blocking foreign companies from operating in its markets. Technology companies such as Google, Facebook and Twitter come to mind. These decisions were motivated by security concerns within the ruling party, as much as they were designed to protect local Chinese firms.

How far will this all go? And will claims of national security serve as instruments of trade protectionism? No doubt, they will.

Prudent businesses would be well advised to be ready for anything.

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Lawmakers Urge AT&T to Cut Ties with Huawei, Citing National Security Concerns

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The Chinese phone manufacturer Huawei is bidding to snap up market share in the United States, but lawmakers in Congress are urging AT&T to cut its ties to the phone manufacturer and work with other companies. It’s not the first time Huawei’s government ties have caused heartburn on Capitol Hill, and it comes just a week after Huawei’s US launch of the Mate 10 was reportedly scrubbed at the last second.

These new allegations are from Reuters, which reports US lawmakers also oppose plans from the Chinese telecom China Mobile Ltd to enter the US market. Issues identified by the regulators as problematic also include an AT&T-Huawei collaboration over the emerging 5G standard and AT&T subsidiary Cricket selling Huawei phones as well. Apparently the problems are serious enough that lawmakers have been warning corporations that deploy Huawei hardware that they may not be eligible to work on government contracts.

Huawei’s global market share has risen sharply over the past few years, including strong gains in a matter of months.

If you’re thinking this all sounds rather familiar, well, you’d be right. Both the Trump and Obama Administrations have sounded similar warnings on Huawei over the years. The result is a US smartphone market that’s somewhat different from the globe as a whole. Samsung and Apple are still the top two device manufacturers worldwide, but from there the list diverges. Globally, Huawei, Oppo, and Vivo round out the top five (Others claims a 41.7 percent share of the market). In the United States, LG, Motorola, and HTC round out the top five, or did as of a year ago.

In 2012, both Huawei and ZTE were the subject of a US government investigation into whether their networking equipment and mobile phones offered loopholes or backdoors that could be exploited by actors working for the Chinese government. The government found neither company’s responses sufficient, but hammered Huawei in particular for failures in transparency. Huawei refused to explain aspects of its corporate structure, its ties to the Communist Party, the results of a 1999 tax fraud audit, the situation in which that audit was dropped, or any financial documents that would support Huawei’s claim to operate as a completely independent entity from its parent organization.

While none of Huawei’s potential US partners have said much about the report, Huawei and ZTE handsets remain rarities in the US market. And in a way, that’s a shame. The US market could benefit from better competition in handsets, particularly at the lower end where low-cost Android devices now offer surprisingly good performance for your dollar. Unfortunately, the past few years has also emphasized both the pervasive security problems posed by mobile devices (including the IoT) and the degree to which cyberwarfare has decidedly real-world consequences. From disinformation campaigns to attacks levied at specific sites or companies, things have gotten more heated. The last thing we need is to deliberately invite such problems to take root.

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US security concerns could stall Huawei’s and ZTE’s 5G expansions

Will U.S. citizens get their first 5G phones from Huawei or ZTE? Not if Congress has its way.

Over the past week, members of Congress have been getting tough on the two Chinese companies, formally identifying both as threats to national security following years of investigations. Today, Reuters reported that unidentified U.S. lawmakers asked AT&T to stop collaborating with Huawei on standards for its next-generation 5G network, and cut ties to Huawei altogether.

The report follows U.S. Representatives Michael Conaway’s and Liz Cheney’s introduction of the Defending U.S. Government Communications Act, a bill to bar the U.S. government from using or contracting with Huawei and ZTE, after a House intelligence committee report concluded that their products were insecure for government and military use.

In the works since well before a September House hearing on Huawei and ZTE, the Congressional actions appeared to coincide with ZTE’s claim at CES that it would launch its first 5G phone in the United States by early 2019 and AT&T’s unexpected decision to kill plans to start selling Huawei phones in this country.

Today’s report suggests that AT&T walked away from Huawei under pressure from government regulators, who were most likely lobbied by the same members of Congress involved in the investigation. It’s unclear whether or how much AT&T was collaborating with Huawei on 5G; the company was reportedly working with Qualcomm and Ericsson prior to announcing its end of 2018 5G network plans, but could easily have had other partners.

There is good reason to be concerned about the security of cellular networks. As VentureBeat reported last week, the upcoming U.S. launches of two 5G networks will mark the beginning of a long-planned drive to put 5G cellular radios everywhere, and within everything.

Designed to add connectivity to billions of devices — securely — 5G is also expected to serve as the networking technology inside next-generation cities and car traffic infrastructures. Consequently, if a foreign government had a secret back door to infiltrate 5G networks, it could take control of entire cities, including all of their 5G-connected devices and vehicles.

That nightmare scenario is the flip side of the “ubiquitous 5G” dream, and the precise reason 5G was built with new security protocols. As Ericsson noted in a 5G security white paper, the ubiquity of 5G will turn virtual vulnerabilities into tangible public safety threats, so 5G networks demand extra protections: integrated attack resistance, multiple layers of encryption, integrity protection against injection or modification of traffic, and authentication superior to username/password combinations, just to name a few. Today, LTE networks running compromised equipment or software can be susceptible to intrusions, and even networks with solid hardware can be taken down by one or more inexpensive devices.

While Trump administration protectionism might otherwise be blamed for the recent Congressional actions, investigations into Huawei’s and ZTE’s potential threats to critical U.S. infrastructure date back to at least 2012, when 60 Minutes and the aforementioned House report spotlighted the concerns. Although ZTE and Huawei are supposedly private companies, ZTE is state-owned and was founded by investors associated with China’s aerospace ministry; Huawei was started by an ex-Chinese military engineer, and has what has been described as an “opaque” corporate structure. Both are suspected of covert ties to the Chinese government, and neither would explain why Chinese Communist Party committees had been set up within their business structures.

In recent years, both companies have been investigated for breaking U.S. laws: Huawei has been accused of assisting an alleged elite cyberwarfare unit of China’s army, as well as bribery, corruption, and immigration violations, while ZTE pled guilty to selling sanctioned computer equipment to Iran, and allegedly obstructed an investigation into the sales.

At the same time, both companies are in the top five for global telecom equipment sales, with significant supply contracts for overseas governments. Their continued growth depends in part upon the United States market, but given the directions Congress is taking, the likelihood of seeing either company making major inroads here has just dropped significantly.

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New Bill to Ban US Government Use of Huawei and ZTE Tech

Proposed by Texan Republican representative Mike Conway, the Defending US Government Communications Act, if enacted would prohibit the US government “from working with service providers that use any equipment from (Huawei or ZTE) for security reasons.” This ban would also extend to any entity that the head of the relevant agency reasonably believes to be controlled or connected to the Chinese government.

Conway commented that “Chinese commercial technology is a vehicle for the Chinese government to spy on United States federal agencies, posing a severe national security threat.”

Cited in the bill was General Michael Hayden, who served as Director of the Central Intelligence Agency and Director of the National Security Agency, he stated in July of 2013 that Huawei had “shared with the Chinese state intimate and extensive knowledge of foreign telecommunications systems it is involved with.”

Extracts from the bill included material from the FBI Counterintelligence Strategy Partnership Intelligence note that asserted that expanded use of Huawei technology equipment and services in US telecommunications significantly increased the risk of the Chinese government accessing US business communications, “China makes no secret that its cyber warfare strategy is predicated on controlling global communications network infrastructure.”

A Headache for Huawei

No doubt this act will be unwelcomed by Huawei, the world’s third-largest smartphone manufacturer and the biggest seller of telecoms equipment after Apple and Samsung, as it will make their task of reaching the US market more laborious. This comes as a further disappointing blow after US mobile carrier AT&T announced last week that it was pulling out of a deal to sell Huawei’s smartphones.

AT&T had come under pressure from US politicians and the Federal Communications Commission (FCC) to halt the deal. Despite this Huawei has said it still plans to continue to launch the Mate 10 Pro without a US Carrier Partner. For now, it will have to rely on selling unlocked devices through online channels.

Huawei’s Hopes For the Future Frustrated

While the US has cited numerous potential security threats from companies like Huawei, Android Authority points out that the “decision protects manufacturers and Apple from a strong competitor muscling in.” If allowed to enter the US market with US government backing, Huawei could have had a significant impact in America and possibly realised its goal of overtaking Apple.

Before the collapse of the AT&T deal and the new bill, Ken Hu, chief executive of Huawei had optimistically predicted in his New Years message that revenue would rise 15%, to earn 600 billion yuan in 2018.

In a 2017 interview with CNBC, Francisco Jeronimo, research director for European Mobile devices at IDC, said: “Huawei is today the biggest challenger to Apple and Samsung. Indeed, they are growing very fast. They will probably overtake Apple in the smartphone business, either this year or next year.”

Huawei is already the second-biggest smartphone supplier in several European countries, including Finland, Italy and Spain. In 2017 it shipped 153 million smartphone units worldwide. According to Business Insider UK, Chinese smartphones hold more appeal as they have a similar level of quality at a fraction of the cost.

Previous Moves to Limit Chinese Telecoms

This isn’t the first time the US has taken steps to limit China’s access to the US market over fears of illicit behaviour. In 2017, Chinese electronics giant ZTE was in 2017 fined over $1 billion after admitting it had violated US-Iran sanctions by shipping product from the US to Iran.

Huawei and ZTE aren’t alone, earlier this month the Committee on Foreign Investment in the United States (CFIUS) blocked Chinese firm Ant Financial’s $1.2 billion purchase of US money transfer business Moneygram, citing fears over Chinese espionage against US military personnel, who use the service.

The US is not alone in this approach, in 2013 Australia upheld its ban on prohibiting Huawei bidding on contracts for the country’s National Broadband Network similarly citing cyber security as the reason.

A Long Way to Go

The bill is far from becoming law, it still has to pass the committee stage, then the House and Senate before it can be signed off on by the President. However, if it does manage to navigate the copious amounts of red tape required it will be interesting to see how this impacts US-Sino relations.

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Nikkei Asia300 Index up 31% in first year from launch

TOKYO — The Nikkei Asia300 Index rose 31% in the first years since its launch on Dec. 1, 2016, buoyed by fast-growing Asian companies that are aggressively adopting information technologies, and by a surging health care sector.

The index is calculated based on the share prices converted into U.S. dollars of the 300-plus publicly traded listings of 11 Asian economies, excluding Japan.

In Asia, market capitalization has been on the upswing for companies riding demand for an increasingly digitized lifestyle facilitated by the spread of smartphones and online marketplaces. Stock markets have also richly rewarded those making forays into health care and other promising fields.

The market capitalization of China’s BOE Technology Group, which has emerged as a global leader in liquid crystal display panels, has more than doubled in the past year. The company is looking to increase shipments of LCD panels for smartphones and personal computers, and has begun commercial production of organic light-emitting diode, or OLED, panels ahead of Japanese makers.

In its rush to expand, BOE has entered the field of smart grid systems and has acquired a hospital and a medical venture. It has set a goal of increasing sales for the year ending December 2020 by over two and half times from four years ago.

The market capitalization of the major Chinese insurer Ping An Insurance Group has almost doubled as well. The company’s growth is driven by the proliferation of information technology and growing awareness of health issues. Its Ping An Good Doctor smartphone app allows users to consult with doctors and make hospital appointments online.

The service has about 180 million registered users, and receives about 400,000 consultation requests a day.

The group’s Ping An Technology, an advanced fintech company, focuses on big data analytics and research on artificial intelligence. Hopes are high that advances in the analysis of data on individual health conditions and credit information will contribute to existing businesses — by calculating premiums, for instance.

Companies outside China are also riding the expansion of IT and healthcare markets.

The market capitalization of Nanya Technology, Taiwan’s leading DRAM memory chipmaker, has nearly doubled over the past year. South Korean biopharmaceutical company, Celltrion, which produces cheap “biosimilars,” using biopharmaceuticals with fewer side effects, more than doubled its market value.

Malaysia’s rubber-glove manufacturing company, Hartalega Holdings, which meets synthetic rubber demand from hospitals and other clients, has also been well-rewarded.

Similarly, the market capitalization of Adani Enterprises, the core of India’s Adani Group conglomerate, has more than doubled.

In June, the group announced a plan to invest in the development of what will be one of the world’s largest coal mines, in eastern Australia. Although the total investment is expected to top 1 trillion yen ($8.9 billion), the stock market applauded the company’s ambitious move to respond to surging electricity demand.

On the other hand, market capitalization fell for companies facing intensified price competition and shrinking markets.

China’s largest personal computer maker, Lenovo Group, struggled to revive the mobile phone and data center businesses. Major Taiwanese smartphone maker HTC booked an operating loss for the 10th straight quarter.

By country, region

The Nikkei Asia300 also releases country- and region-specific indexes, which mirror economic and corporate trends in each area, revealing sharp increases in South Korea and China.

As of Nov. 29, the South Korea Index had jumped 48% from Dec. 1, 2016, led by companies that have semiconductors as their key products.

Samsung Electronics shattered its previous record operating profit at its flagship semiconductor division for the fourth consecutive quarter through the July-September period.

The company will respond to concerns over memory supply shortage, beefing up its OLED panel business for smartphones. Its capital investment spending for fiscal 2017 is expected to reach a record high.

The consolidated operating profit of SK Hynix hit a record for three quarters in a row, thanks to robust demand for DRAM as well as NAND flash memory used in smartphones and data centers.

There are concerns, however, about the sustainability of the strong performance of the Asia300 Index, due to its heavy exposure to the semiconductor market.

The China Index was 39% higher as of Nov. 29. The market capitalization of China Petroleum & Chemical (Sinopec), one of the country’s three major state-owned oil companies, and that of other companies, has been buoyed by the global economic expansion and the recovery in oil prices stemming from output cuts in oil-producing countries.

Sinopec’s cost-saving efforts have contributed to the improvement of its profitability, while shale gas production in the southwestern city of Chongqing remains stable.

Telecommunications equipment giant ZTE is one of China’s companies that has benefited from advances in communications infrastructure development undertaken by state-owned telecom giants. ZTE forecasts a net profit for the year ending December 2017, as it caters to demand spurred by investment in the fourth-generation (4G) networks.

The ASEAN Index, which comprises companies in the six countries of the Association of Southeast Asian Nations, underperformed the South Korea and China indexes. However, Hartmut Issel of UBS Wealth Management said Indonesia and Thailand warrant particular attention.

Important elections are scheduled in 2018 and 2019 in these countries, he noted, with the possibility that their governments could introduce policies to spur consumer demand, driving up stock prices.

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Why China Unicom’s Stock Has Outperformed This Year

China Unicom’s stock is up by close to 25% year to date, outperforming its rivals China Mobile and China Telecom, who have see their stocks remain essentially flat. Unicom’s strong performance is driven by some improvement in subscriber additions, positive sentiment surrounding China’s mixed-ownership reforms and the proposed IPO for the China Tower Joint venture. Below we take a look at some of the factors that drove the price increase.

Trefis has a $14 price estimate for China Unicom, which is in line with the current market price.

Customer Adds Are Improving

China Unicom has been improving its 4G coverage, partly leveraging a collaboration agreement with China Telecom. The carrier has also been transforming its sales and marketing model, by working along with Internet companies to leverage big data analytics and online customer touch points to better target customers, and reduce customer acquisition costs. The company added roughly 4.5 million subscribers this year (as of May 2017), marking an average of about 500k new customers adds per month. Moreover, as China Unicom’s networks have significant capacity, and its network operating costs are largely fixed in nature, much of the incremental service revenues from new customers could flow directly to the company’s bottom line.

IPO Of China Tower JV

The China Tower joint venture, which is the spin-off entity that runs infrastructure for Chinese carriers, intends to file for an initial public offering shortly. The company is reportedly looking to float between 10-20% of its shares, raising as much as $10 billion, most of which is likely to be returned to the three major carriers. China Unicom is likely to be a big beneficiary of this, as it holds roughly 28% stake in the entity. This could provide the carrier with a relatively strong cash infusion following the IPO.

Mixed Ownership Reforms

The Chinese government has been looking to increase private investment into various sectors of the economy. China Unicom has been a contender for this mixed-ownership reform, given that it has been underperforming its peers in recent years. Reuters reported in mid-June that Internet giants Alibaba Group Holdings and Tencent Holdings are tipped to be among the investors who will invest roughly $10 billion into China Unicom’s Shanghai-listed affiliate, China United Network Communications Ltd. This should prove positive for the company, as it could reduce state ownership and increase management autonomy, while bringing in fresh capital for expansion.

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