AT&T has reneged on Huawei's first distribution deal with a US carrier, leaving the firm's expansion ambitions in tatters. Huawei is reportedly trying to secure a new deal with the AT&T rival Verizon, but political pressure may mean the firm will ...and more »
Huawei's consumer CEO, Richard Yu, with the new Mate 10 Pro. Rick Wilking/Reuters
AT&T has reneged on Huawei's first distribution deal with a US carrier, leaving the firm's expansion ambitions in tatters.
Huawei is reportedly trying to secure a new deal with the AT&T rival Verizon, but political pressure may mean the firm will struggle to find a new US partner.
Huawei is the fourth-biggest smartphone maker in the world, and it hoped to finally crack the US market with the launch of the new Mate 10 Pro flagship phone.
It looks as if the firm will launch the phone without a carrier partner — but most US consumers buy their phones through a carrier.
The collapse of the deal coincides with US politicians expressing concerns that Huawei is a security threat.
The Chinese smartphone maker Huawei has hit a major stumbling block in its US expansion plans, with its first deal with an American carrier apparently falling through because of political pressure. A second deal is also looking shaky.
Huawei had been set to launch its new flagship smartphone, the Huawei Mate 10 Pro, with AT&T in February. But according to The Wall Street Journal, the carrier backed out of the deal without any explanation. AT&T is the second-biggest carrier in the US, and the collapse of the deal essentially shuts Huawei out of the US smartphone market.
A second deal with Verizon is looking unlikely, with the carrier also under political pressure to cancel a planned summer launch of the Mate 10 Pro, according to Android Police.
AT&T and Verizon have not commented, but Huawei said it would be launching the Mate 10 Pro in the US without carrier partners.
AT&T's cancellation comes weeks after the US Senate and House intelligence committees reportedly sent letters to the Federal Communications Commission arguing that Huawei was a security threat. It was also worried about US carrier deals with the smartphone maker.
It's awkward timing for Huawei, which showed off the Mate 10 Pro at the tech show CES this week. During the launch, the consumer CEO Richard Yu said the firm had the "highest standard in privacy and security" and said the carrier deals were a "big loss" for customers, who now have less choice.
Huawei said it would sell the Mate 10 Pro in the US unlocked, meaning it won't be attached to any particular carrier. Most US consumers don't buy unlocked phones, though, instead going through carriers to buy new phones.
Huawei is the fourth-biggest smartphone maker globally because of its massive popularity in Asia, according to IDC. It has also made strong inroads in the UK and is the third-biggest brand behind Samsung and Apple, according to Counterpoint. But it has never managed to crack the US, and the firm will have to rethink its expansion plans after this latest blow.
This isn't the first time US politicians have suspected Huawei of being a security threat, though they have never offered proof in public.
Back in 2012, when Huawei was better known for making broadband equipment, the US warned that the Chinese government may be using the firm's kit to spy on foreign countries. At the time, Huawei hit out at international "protectionism." The UK's security watchdog also worried about a telecoms equipment deal between BT and Huawei. Huawei eventually established a UK office, overseen by the government, to investigate its own kit for security flaws.
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