Washington, DC, June 4, 2019 --  

America's ban on technology sales to Huawei risks a long-term schism in the high-tech world.

The iconic image of an anonymous man blocking a tank in Tiananmen Square gets plenty of attention during anniversaries of China's crackdown on the 1989 pro-democracy movement. But it is a far more recent act of defiance by a non-anonymous man has had far more impact. Just over nine years ago, Sergei Brin, co-founder of Google, pulled the company out of China, citing to an incident where Chinese intelligence agents allegedly hacked Google's servers to access information on dissidents in the communist country.¹ Perhaps not surprising for a man born to a family of Refuseniks in the Soviet Union, it is still a remarkable case of a billionaire businessman rightly putting principles before profit.

In the ten years since that anniversary, the mobile internet has exploded in importance around the world, and inside China as well. Google's Android operating system has taken 80 percent market share, making it the leading platform for this technological revolution. But as a result of Google's pullout from China, versions of Android installed on Chinese phones don't have the key features the rest of the world associates with Android. There is no Google Play Store. There is no Gmail. There is no Google Maps. And there is no copy of Google Play Services, which allows other apps easy access to Google web services.

Free from Google's oversight on phones sold in China, manufacturers of brands like Huawei and OnePlus started modifying their versions of Android to make it different from versions in the rest of the world. The nasty apps sold in China's many competing Android App Stores were riddled with spyware and aggressive location tracking, often causing rapid battery drain. In response, Chinese manufacturers altered their versions of Android to block apps from executing in the background. Such non-standard (and secret) implementations of Android already cause Western app developers to pull their hair out with frustration when they try to target these phones. And when Chinese manufacturers started exporting these cheap phones to global markets, those equially nasty changes started spreading around the world.

The fracture between Chinese versions of Android and international Android marked a notable milestone in the history of technology. But now that the Trump administration has banned sales of U.S. technology to Chinese tech giant Huawei, this fracture is set to grow into a full-blown schism.

Enforcement of America's blacklist on technology exports to Huawei means that Google will ultimately be unable to install its Google Play Store, Google Maps and Gmail on Huawei phones meant for sale on world markets. This critical restriction, along with other restrictions preventing various American microchip designs from being used by Huawei, have led many analysts to conclude that Huawei is doomed. Even if Huawei follows through with its pledges to release its own hardware designs and operating systems independent of US technology, who on Earth will want a phone that won't run Gmail, Facebook or Twitter?

The Chinese, that's who.

Remember that Chinese phone users have already been cut off from Google apps since the company pulled out in 2010. The repressive Communist government has banned the use of Twitter and Facebook as well, knowing that these social media platforms might be used to organize (gasp!) pro-democracy demonstrations. A whole generation of Chinese have grown up not knowing about any of these apps, instead using superficially similar home-grown Chinese social media and communication apps under the close control of the communist regime.

Add to the mix a sense of outrage at America's treatment of Huawei. The export blacklist is supposedly inspired by security concerns over Huawei's 5G telecommunications equipment. American intelligence officials say they worry that backdoors in Huawei equipment might be used to intercept sensitive information, and America has pressured allies (with limited success) not to allow Huawei equipment in their 5G networks.

But American intelligence officials have provided absolutely no evidence in public to support their claims of a security risk. Bloomberg News did report last month that Vodafone technicians once found a "telnet" backdoor in Huawei routers², but this evidence is almost laughable. Telnet backdoors are commonly put into computer equipment for legitimate testing purposes (including in systems built by this author as part of his geeky day job). These kinds of backdoors are hardly secret, simple to detect, and easily closed off.

It is a widespread perception, especially in China, that the real purpose of the Huawei blacklist is as a tool of the Trump Administration's trade war on China. Intended or not, this is likely to give Huawei a patriotic shine in the eyes of Chinese consumers, and make them even more likely to buy its products as opposed to those of American brands like Apple. Indeed, even in a milder phase of the trade war, Apple unit sales declined 30 percent in the Chinese market in the first quarter of this year.³

Even if Huawei loses all of its international phone sales due to the American blacklist, it will hardly be the death of the company. Huawei can still make a tidy profit selling phones to China's 1.4 billion people, using a forked copy of Android and the existing Chinese app stores. Chinese consumers won't even notice a difference.

What the blacklist will do is serve as a wedge to widen the growing schism between technology targeting the Chinese market vs the rest of the world -- a silicon curtain, if you will. It's too soon to say exactly where that will lead. But it's a good bet that the consequences won't be good for anybody.

Related Web Columns:

Rule of Unjust Law, December 18, 2018

Coming Home to Roost, April 9, 2018

Notes:

1. Spiegel Online, Google Co-Founder on Pulling out of China: 'It Was a Real Step Backward', March 30 2010

2. Bloomberg News, Vodafone Found Hidden Backdoors in Huawei Equipment, April 30, 2019

3. Canalys, Huawei Gains Record 34% of China's Declining Smartphone Market, April 30, 2019