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rick merritt
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re: China bar Cisco, Motorola and HP
rick merritt   8/23/2010 7:05:53 AM
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Should China's Huawei or ZTE be able to acquire U.S. companies and/or do business with the U.S. government?

NGHIA.NGUYEN
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NGHIA.NGUYEN   8/27/2010 10:58:45 PM
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Definitely not! It is a matter of national security risks. frankly, Huawei is business front of a hidden arm of the Chinese Military machine. the network eqipments from Huawei will allow backdoor for China to spy or worst - disrupt US Internet infrastructure when a US China conflict occurs (trade war, attack of Taiwan, etc.) The comparison of US companies vs. Huawei taking order from the government is naive and stupid. US engineers will not accept nor keep silence if CIA ever try to recruit them to create backdoor. We have a much higher standard of ethics. For China, if an engineer/company does not do what the government wanted; their lives and families are dead. This author needs to learn better about how a communist system works and use its power.

bmonk
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bmonk   11/25/2012 11:07:17 PM
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Typical China hater from a Vietnamese native. It is not worth my response to his comment.

TingLu
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TingLu   9/10/2010 1:26:52 PM
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How Naive!!

Lionlair
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Lionlair   8/23/2010 8:17:37 PM
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Hum - Maybe the various US companies should bring their production home as well. Hire US engineers and Techs. Maybe force Huawei to move some of its operation to produce stuff for China and the ROW to the US. We can't be the thinker nation as was falsely told. First the job giveaway was for assembly. Just retool the minds of our assembly people... Then Engineers and inventory went overseas. Now they (foreign vendors want to come in and take what business that is doing away as well. How is the US people going to make a living? Building a wall of the USA - out of rock and stone I suppose... Martin I say NO. Enough is enough!

KESERT
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KESERT   8/24/2010 3:58:16 AM
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Huawei want USA market,but not business mode of USA.

Etmax
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Etmax   8/24/2010 1:22:29 PM
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100% behind you on that. When China is a true member of the world community with fair equivalent wages and benefits, has environmental laws and a real democracy so that we are on an even footing, then we can talk about it.

Dong.Liu_#3
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Dong.Liu_#3   8/23/2010 8:21:32 PM
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I am definitely with Rick about Huawei issue. US can be generous, donating a few billion here and killing a couple of dictatore there; but US can be very selfish, too. Whatever they do they have a pretty, lawful reasons, whicl whatever the Chinese do they are doing it for the communist' interest. These dirty politicians, I doubt if they received enough PR expenses from the companies they try to ban doing busines.

Zeev00
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Zeev00   8/23/2010 8:25:23 PM
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Two short comments. Firstly, one should distinguish between companies working mostly in civilian areas like HP or Cisco as compared to, say Raytheon or Northrop-Grumman. I have no knowledge of Huawei's market or connections so I can't really say which class it belongs to, but assuming a-priori that it is in the same class with HP or Cisco, exposed mostly to market pressures rather than government pressures, seems misleading. Further, translating, "funding from China's army" to "bidding on DARPA grants" also smacks of demagoguery without further details. Secondly, commenting that the eight senators are republicans is not germane and not really helpful. Idiocy, protectionism, and national jingoism are not necessarily republican attributes. If you don't believe me, look up the NAFTA dispute with Mexican truckers which has resulted in increased tariffs on US good just this month, or Congress' refusal to ratify the free trade agreements with Columbia and South Korea since the democrat won it in 2006. In other words, it would help it you decided whether you want to smack idiots for their acts, or whether you want to write a political attack on one party under the guise of issue-specific pitch.

Sheetal.Pandey
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Sheetal.Pandey   8/23/2010 9:05:47 PM
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wow technology and politics all together! what a story. i wonder if its really true?

GeorgeCDO
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GeorgeCDO   8/23/2010 10:33:03 PM
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I suggest you go to Wikipedia and look at Huawei's entry, especially: Criticisms and controversy Technology theft Customer relations Security concerns Workforce treatment Some of Huawei's first products were routers running Cisco's router code. I have talked with friends who saw Huawei equipment that displayed Cisco error messages. The other concern is that counterfeit Cisco gear turned up in China two years ago and posed a potential security threat. May 12, 2008 FBI worried as DoD sold counterfeit Cisco gear: By tampering with networking equipment, spies could open up a back door to sensitive military systems ... In late February the FBI broke up a counterfeit distribution network, seizing an estimated $3.5 million worth of components manufactured in China. This two-year FBI effort, called Operation Cisco Raider, involved 15 investigations run out of nine FBI field offices ... According to the presentation, Cisco's gold and silver partners have purchased counterfeit equipment and sold it to the government and defense contractors. http://www.infoworld.com/d/security-central/fbi-worried-dod-sold-counterfeit-cisco-gear-266 People should at least read the NY Times article (link included in the EE Times article). Personally, I think it is likely that in the near future, Huawei equipment will be found to have intentional security leaks. And if they get this Sprint Nextel contract, they will use it as as a starting point to undercut and dominate the US telecom market. If Huawei doubles their annual sales, they will be bigger than Cisco, which was added to the Dow Jones Industrial Average last year.

old account Frank Eory
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old account Frank Eory   8/23/2010 11:51:39 PM
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Huawei is already a global company with a substantial market share. Nobody has yet reported any intentional security leaks or evidence of anything that would raise national security concerns. Perhaps the U.S. government might choose not to do business directly with Huawei, and it has that right, but here we are talking about a for-profit company, Sprint-Nextel, having the right to choose to buy equipment from Huawei rather than from a western company. It's Sprint-Nextel's business, not the governement's...

jimcondon
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jimcondon   8/24/2010 12:27:58 AM
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It truly saddens me that this letter is not about any real attempt to look at issues like outsourcing of engineering jobs or any other economic issue that would be important at this time. This is simple electoral pandering and payback to political backers. It has no more real importance to the american people than steroids in baseball. Politicians need to start worrying about the real issues in our country rather than sending out conspiracy theories that sound like they are out of the latest spy novel.

goafrit
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goafrit   8/24/2010 1:03:00 AM
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You are absolutely correct. I would have preferred job protection than the nonsense of Huawei. America must wake up to globalization, but Americans deserve good jobs.

TingLu
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TingLu   9/10/2010 1:32:20 PM
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I would rather prefer to make people more competitive than job protection. If same talent with 1/10 pay in China, it is fair that job should go to China.

chanj0
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chanj0   8/24/2010 12:41:45 AM
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Globalization is indeed happening. Business is business. If we support free market economy, shall we selectively keep certain business from operating? I am more interested in knowing what kind of opportunity the worry will bring.

docdivakar
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docdivakar   8/24/2010 2:00:00 AM
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The discussions above take me back to the print days of EE Times where we had scores of debates on H1B's, globalization, immmigration, cheap labour, and on and on... Eventually market forces win, won they have, and have continued to do so despite one's sentiments and national pride. The past decade has seen incredible progress in driving the cost down on electronics while cannibalizing the very customer market it was supposed to market to! When jobs disappear to lower cost locations and replenishment of opportunities is non existent, we know that this model is seriously flawed. The basic premise of globalization was that given a "level" playing field, any enterprise from any country that delivered the most value is supposed to win. It was not supposed to be a zero-sum game but one with more value additions and opportunities to all sides. A continuing non-equilibrium was supposed to keep the top of the pyramid running while creating more opportunities for the stacks below. In an era of increasingly open and accessible knowledge, it has become almost impossible to keep the top replenished with value-based opportunities. Much blame can and should be assigned to profit at any cost. Investors and VC's always talk about exit strategy -you seldom hear about any 'staying' or 'commitment' strategy! If there is ever an undoing of the capitalistic model, it is this greed from a few corporate behemoths that value money over minds and have the clout to sway entire continents. Until a conscientious capitalistic model evolves, we are doomed to be stuck in this predicament and pay the prices. In my world and in my own words, Capitalism 2.0 = Conscientious Capitalism! As the owner of a struggling 3-person startup, I am proud to say this: at the end of the day, my assets go home! MP Divakar

kdboyce
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kdboyce   8/24/2010 6:13:54 AM
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To Mr. Divakar's "Capitalism 2.0 = Conscientious Capitalism" statement I would add the necessity of a nation's overall survival. Some would see this as a "market" survival within a nation, e.g. the population must be able to buy/acquire goods and services regardless of a particular political slant. If we produce nothing, we can afford nothing. If we cannot (or will not) produce what we need to survive, then we are at the mercy of other nations. And unless we can do far better than this minimum standard, we cannot afford to buy from anyone else. Is that where we want our Nation to be? For me, the answer is an emphatic NO!

rick merritt
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re: China bar Cisco, Motorola and HP
rick merritt   8/24/2010 1:54:07 PM
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Interestingly, Huawei took an active role among organizers and presenters at Hot Chips and the Multicore Expo in recent months. Cisco and Alca-Lu did not.

VincePG
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VincePG   8/24/2010 5:47:38 PM
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When you consider we are trading away our standard of living, those cheap products at Wal-Mart aren't so cheap after all. China is second to the US in military spending(granted a long second, but growing). They got the first contract to develop the $1trillion mineral deposits in Afghanistan(apparently with the US blessing) Iran and Iraq already mentioned. In 2009, we exported about $70B to China and we imported about $300B, which to me is shocking given all the building going on in China. Proof of import restrictions against US goods? As of June, 2010, China has about a $2.5 trillion foreign exchange reserve, most of which was created under the approving eye of President Bush. China is lobbying very hard to remove the US dollar as the reserve currency. They’ve attacked our currency and export base by blindly pegging their currency to the US dollar. China is now balking at buying more treasury bonds with the money from all the imports we take from China(they hold about $850B). China does not respect international patents and seems to systematically steal intellectual property. China is the #1 foreign cyber terrorist and has been suspected in cyber attacks against our power grid and defense computers. Now I find it very puzzling given these circumstances, why the US is concerned whether China gets a fair shake in competing on US contracts. China seems like a spoiled child, with the US playing the parent’s role. It seems no matter what's done for this spoiled child it just wants more. We should treat China like the hardball competitor that they truly are, instead of some sort of weak reformed communist ally which they are not.

suckme
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suckme   8/24/2010 6:38:14 PM
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Hey Rick, I don't get your logic. If we really decided to have a trade war with them, I think we could hurt them more than they could hurt us. If they say no Cisco, we can say nothing made in China comes to America. The truth is that the Chinese are sleazy stealers of US tech. Huwaei copied the Cisco router and made millions of that copy. Why don't you get on board in protecting American IP interests and tech jobs here.

suckme
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suckme   8/24/2010 6:39:48 PM
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Oh, it's probably because you are an Obama loving lib. They are Republican Senators. Get ready for a blowout in November.

junko.yoshida
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junko.yoshida   8/24/2010 9:18:49 PM
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Hi, suckme. I am actually with jimcondon and goafrit. What bothers me about this is these US senators' letter has nothing to do with engineering or the job protection for the U.S. engineers. These Senators are using what seems like an engineering issue to promote their political agenda. And to that end, I am not even sure what political agenda they are promoting! At any rate, I think it's misguided to get into the Democrats vs. Republicans spat, especially on this issue, in this message board.

suckme
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suckme   8/25/2010 1:23:55 AM
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OK lady, All these countries abuse us when it comes to trade. It's a one way street. Anything should come into the US with no regulation. However, when it comes to the US selling products there, they have all kinds of roadblocks. You really did not address my concern that they are sleazy snakes and stealing our tech. What about all the EDA tools that they crack the license for and use for free? I think the US EDA community has lost millions to the sleaze balls. There is no legal recourse in China to recoup your loses. For example a current article on EE times. http://www.eetimes.com/electronics-news/4205926/EDA-vendor-sues-China-s-ZTE--alleges-software-piracy Just another American company to get the shaft from China cheaters. Microsoft has lost millions there too. They copy or steal everything because they do not believe in the rule of law there. They steal all our software and ideas. They are cheaters and not held accountable. Also, don't you believe in national security? I am worried they could spy. Several Chinese people have already been busted spying on our high tech companies. I'm just wondering what the guy's motivation for his title. He sounds like a good Anti-American Obama communist.

Zeev00
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Zeev00   8/24/2010 8:33:48 PM
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Rick Merritt: "Interestingly, Huawei took an active role among organizers and presenters at Hot Chips and the Multicore Expo in recent months. Cisco and Alca-Lu did not." Meaning exactly what? That participation in Hot Chips is relatively inexpensive and Huawei can afford it? That Huawei is more "socially responsible" than Cisco? That Huawei is in some way "smarter" than Cisco? I expect somewhat more from journalists than just write important sounding but meaningless prose. So far I have been disappointed.

Robotics Developer
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Robotics Developer   8/24/2010 8:51:26 PM
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I would echo the concerns for allowing a non US based company from acquiring major networking companies in the US. We rely too heavily on the internet (both public and Armed Services) to risk potential security breaches that this would potentially enable. I am not saying the company would do anything illegal but why risk it? How many other companies / countries are barred from providing systems/components to the federal government especially when DOD is involved? It just makes sense that we should protect our national interests.

jwc
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jwc   8/24/2010 9:16:22 PM
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The world is a tough dangerous place. We have been insulated from much of that danger and from consequences of myopic short-term thinking for 100 years +. The consequences are just beginning to show themselves. This century will be very different.

Charles.Desassure
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Charles.Desassure   8/24/2010 11:47:24 PM
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Thanks for your article. Eight senators’ is no representation of the other 92 senators in the U.S. Congress. Just because some members of Congress write a letter, doesn’t mean that the Obama Administration is going to investigate Huawei Technologies. The White House receives letters daily from interest groups and others who feel that their view points should be at the top of the agenda. Cisco Systems, Hewlett-Packard, Motorola and other major U.S. high tech companies are in China and other countries around the world, not because of the US government, but because these companies have a good product or service to provide to its customers. In addition, by having these companies in China, it also provides jobs for citizens in China. But another point is that these are private companies, not governmental agencies. I believe the China government leadership is much wiser than to ban these outstanding and other high-tech companies because of a letter to the Obama Administration. Trust me; the Obama Administration has other important things to be concern about, and this is not one of them.

suckme
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suckme   8/25/2010 3:39:02 AM
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Perhaps I am paranoid, too. But I think it would be interesting to trace what donations certain Huawei competitors have made to these senators. What an idiot you are. That is the most idiotic statement in your whole misguided rant. They are the ones stealing. They are the ones cheating. They are the communists. They are the ones abusing human rights. You're just and obvious lib.

Relia
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Relia   8/25/2010 9:31:30 AM
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I supports Rick's points. China telecom has been buying many equipments from Cisco, why can not US companies buy from HuaWei? I know HuaWei very well, they have cruited many engineering talents and they work much harder than Western engineers. It is very often for them to work till late night to finish tough projects, so it is not surprising their products become more and more competative than Cisco's, they started to get international market shares from Asia, then African, then East europe, now it turns to fight with Cisco on its home - US. This is very natural thing, Prodcuts speak for themselves. Market protection is bad for both sides, actually China wants US's high tech products badly, but US does not want to export...

Bob Lacovara
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Bob Lacovara   8/25/2010 1:23:39 PM
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Anyone who would like a taste of what cooperation and aid to an industry in China can do has a simple assignment. Have a look at the production of apples in the US. Before, and after the Dept. of Agriculture assisted the Chinese in developing apple production. It's not a pretty picture. Competition, of course is a primary ingredient of capitalism. However, teaching your competitor to produce one of your products, using dirt-cheap labor and relative freedom from anything resembling quality controls is not. To add insult to injury, US taxpayers funded whole fiasco.

Ironman-46
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Ironman-46   8/25/2010 4:36:08 PM
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Rick - You are naive on this one. With this attitude add these companies to the long list of once strong now dead US firms. In an ideal world your are absolutely correct. Unfortunately, China and HuaWei do not participate in a fair and level playing world. The entire foundation of the company is tainted by outright IP theft. They receive tremendous government subsidies (as do most Chinese firms). Their goal is dominance an any cost; forget about profits or employees, etc... They will buy and steal thier way to success. Some oversight is needed. Thanks to these Senetors for standing up.

old account Frank Eory
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old account Frank Eory   8/25/2010 9:13:49 PM
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Huawei and ZTE are now winning 3G infrastructure business in India by agreeing to very strict security regulations and huge fines for security breaches -- and it is the U.S. and European companies that are complaining that these new security compliance regulations are too strict! I hope that EE Times picks up on the story I just saw elsewhere about this. India has lifted its ban on imports of telecomm networking gear from Huawei, ZTE and Nokia Siemens Networks. Apparently ZTE has agreed to hand over it's source code to India telecomm officials and has agreed to strict new security regulations, huge fines for security breaches, and also agreed to employ Indian engineers for the 3G build-out.

KB3001
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KB3001   8/25/2010 9:41:28 PM
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While I can understannd the concerns around Huwaei's meteoric rise and allegations of IP thefts from Cisco, I think this letter by a number of US senators is simply a political stunt for electoral reasons. There are indeed serious questions related to intellectual property protection in China and others countries, fair trade, employment laws etc. but the way to deal with these is through concerted "international" efforts.

will99878898
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will99878898   8/26/2010 7:38:03 AM
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hey folks in US, you guys need to support Huawei's entry which will bring you super cheap telecom service the rest of world now enjoying. In china, monthly mobile cost could be lower than $1 for a normal user now. (based on recent promotions) so this is for your benefit as well, imagine no chinese shoes, a pair of nike could still cost $100.

Hughston
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Hughston   8/26/2010 3:34:51 PM
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Every company I have worked for in the last 15 years has either had technology stolen by China or been supplied defective parts by China. Motorola is perhaps the poster child of stupidity in these deals. It's hard to believe that major US companies keep ignoring this to get access to cheap labor and a large low margin consumer market. At least somebody in the government has noticed.

MikeSantarini
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MikeSantarini   8/26/2010 6:17:16 PM
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Nice, controversial post, Rick. This speaks to hypocrisy,political biases, jingoism, off-shoring, IP and even racial stereotypes. China's views of IP, government and human rights is a touchy subject given the US economy and electronics business worldwide is so reliant now on money from China. The soap box these days is made of soggy cardboard. This SNL skit rolled it up pretty well http://www.nbc.com/saturday-night-live/video/china-cold-open/1178451/

Bob Lacovara
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Bob Lacovara   8/26/2010 7:05:33 PM
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China's record in handling (other people's) IP, and human rights isn't a "touchy subject". It is a matter of record, whether or not people like to hear of it. Attacking the sources of the information as being hypocrites, biases,jingoists... etc isn't a response, it's merely an ad hominem argument. To ignore China's past behavior if it's inconvenient or politically inconvenient is dangerous if you are going to put your money down on one of China's barrel heads. If you have no skin in the game, then you are free to choose the information you wish to see, and act accordingly. By the way, if you rely too heavily on SNL for interpretation and analysis of politics, you run the risk of being regarded as a comedian. Rick's post merely states that China's left a well-known trail of unsavory industrial actions (let's ignore for the moment it's activities in other venues) and expresses exasperation with the many companies that choose to increase the bottom line by lowering costs. Of course, that's not a bad way to increase profit, unless, as is evident to all, that supping with China demands a long spoon. Whose spoon is long enough?

rick merritt
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rick merritt   8/29/2010 1:46:47 AM
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Feory: Interesting story on India. I'll try to look into it. It suggests US an Euro companies don't want to let go of their high margins and proprietary software while a hungrier China will be more competitive. All: Agreed China has a poor record in IP and human rights. But the proper response from the US gov't is not to try to shut its companies our of US markets.

will99878898
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will99878898   8/30/2010 1:53:56 AM
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China and India are both acts reasonable and fair here if the story is true. US and Euro companies might feel a bit disappointed when losing the political 'advantage'. You can't blame a country's product unsafe... just for some nonsense reasons, US is a racial discriminated country back to when? why you buy chinese friges/tvs if you think the govenment got a problem? any product can be checked/tested to ensure it's safety, including food, software etc. you just need to put in some effort to understand it. china and india, US etc has signed all the treaties so they should not discriminate any chinese product for political reasons, otherwise why not just set up a embargo? Some US/Euro ppl's plan might be, yeah lets trade, you buy our high margin chips/softwares and we buy your low margin shoes... In the end I will make ten times what you make.... so when it comes to china/india compete with them in high margin areas they started to .... EET please wake up and let your editors have some basic sense.

Silicon_Smith
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Silicon_Smith   8/29/2010 2:01:19 PM
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It is justified for responsible people in a country to monitor the activities of foreign entities, communist set-up or not. Freedom is only meaningful, if fair to all. It will be foolish to regard the Chinese companies with the same yard sticks. If necessary, a change in yard stick is called for, similar to what the telecom authorities in India have done.

WSOCT
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WSOCT   9/3/2010 1:39:34 AM
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Politics and business don’t always work together and this is a perfect case in point. The recent face-off between Google and Chinese government was an ugly reminder that we’re still a long way off from being a globalized (and civilized) economy. Huawei has been under the scanner for several years now but there are no conclusive evidences to support the allegations. If US decides to ban all Chinese companies and vice-versa, I’m sure it will be a perfect recipe for disaster for both countries. I can appreciate concerns related to job protection but I’m not fond of playing on people’s sentiments and linking this to “national security fears”. I’m certainly concerned over the future of so-called “global trade” in United States and China alike. - Keith Schaub

ChakC
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ChakC   9/6/2010 9:18:24 AM
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I think Huawei (an International company) is producing many good engineering stuff that can improve the daily life of many people. We need to separate engineering advancement and political issues. I understand why people have these concerns.

Code Monkey
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Code Monkey   12/13/2011 10:04:28 PM
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Companies in the US work for the shareholders. Companies in China work for the state. This makes business a far different game in China. Chinese capitalism can't be like western capitalism even if it wants to be. The end goals are too different. When a tiger says it has changed its stripes, you have to wonder if hasn't simply weaponized capitalism.

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