Huawei to move toward software development in wake of US restrictions

Chinese telecommunications giant Huawei’s leadership is moving the company toward software development in the face of crippling pushback by many Western nations against use of the company’s hardware.

“First, we must dare to lead the world in the pure software domain,” Huawei Founder Ren Zhengfei wrote in an internal memo reviewed by The Hill. “Second, in domains where software overlaps with hardware, we should focus on optimizing software to complement hardware.”

The memo, first reported Monday by Reuters, was based on notes from two meetings Zhengfei held with scientists and software experts in April, but only published internally this week. 

Zhengfei alluded to restrictions placed on the company designed to prevent Huawei from doing business in the U.S., writing that by moving into the software development space, the “US will have very little control over our future development, and we have much autonomy.”

In order to meet the goal of transitioning to software development, Zhengfei stressed the need for the company to “embrace the talent of the world” and recruit globally. 

“We must dare to gather the best talent from this domain,” Zhengfei wrote. “While the US is excluding people, we can absorb a great many talented people and experienced experts from abroad, including non-Chinese people. We must stay calm and composed, and move forward one step at a time.”

A spokesperson for Huawei confirmed the move towards software, telling The Hill Monday that the company was being forced to move away from hardware due to what they described as “decoupling” efforts by other nations that were splitting the world on telecom products.

“If decoupling continues and Huawei is forced to rely on markets such as those in China, Asia and Africa, Huawei will survive,” the spokesperson told The Hill Monday afternoon. “But the world will be a split world.”

“Restrictions on hardware exports are forcing Huawei to move into software and devote more resources as well as efforts, and this could lead to a stronger as well as better Huawei. Recent trends left unchecked mean the ICT industry will be more divided, which is not good for companies, manufacturers and consumers in China, the U.S. and around the world.”

The push for software development comes after many nations, including the United States, have pushed back hard against the use of Huawei equipment due to security concerns tied to the potential that Huawei is linked to the Chinese government. 

The Trump administration cracked down hard against Huawei, one of the largest 5G equipment providers in the world, and added it to the Commerce Department’s “entity list,” effectively blacklisting Huawei. 

Former President Trump also issued an executive order last year requiring ByteDance to sell TikTok or have it banned from use in the United States. The effort to ban TikTok stalled out in the last months of the Trump administration, with the deadline for sale of the app passing with no action taken.

Additionally, Trump signed into law legislation banning the use of federal funds to purchase Huawei equipment, and the Federal Communications Commission formally designated Huawei as a national security threat last year.

The Biden administration had not yet addressed how it will approach Huawei, and Commerce Secretary Gina Raimondo told reporters last month that national security adviser Jake Sullivan is leading a review of Huawei policy and other policies related to Chinese technology groups. 

“A lot of people have said, will Huawei stay on the entity list? I have no reason to believe that they won’t, but we are in the middle of an overall review of China policy,” Raimondo told reporters at the White House. “We are in the thick of it right now. We are working as aggressively as we can; we’re not wasting time on it.”