MIT severs ties with Huawei and ZTE following US investigation around sanctions violation

[kuhnertdm]

Source: https://www.reuters.com/article/us-usa-huawei-tech-zte/elite-u-s-school-mit-cuts-ties-with-chinese-tech-firms-huawei-zte-idUSKCN1RG0FS

MIT statement: http://orgchart.mit.edu/node/27/letters_to_community/new-review-process-elevated-risk-international-proposals

 

Story: MIT announced yesterday that they will not be renewing deals or accepting new ones with Chinese-based tech companies Huawei Technologies and ZTE Corp for the near future, as the US government investigates both companies' alleged sanctions violations. Huawei is currently under investigation after their CFO was arrested in Canada last year at the US's request for committing bank and wire fraud in order to circumvent US sanctions against Iran. Huawei has consistently denied the allegations since the incident. ZTE on the other hand was caught shipping goods from the US to Iran and North Korea, breaking similar laws. They were forced by the US to pay $1.4 billion to continue doing business in the US.

 

MIT's announcement states that they won't be doing any more business with Huawei and ZTE until circumstances change. This could potentially be until the investigation concludes. They also announced stricter rules on in what circumstances they will collaborate with other companies in China/Russia/Saudi Arabia, countries whose interests commonly conflict with those of the US, where MIT is based.

 

Opinion: I want to stress the difference here between the two major allegations against Huawei. The one that's relevant here is that they allegedly tried to circumvent US sanctions against Iran, for which there is some significant evidence showing that this is possible, and for which the investigation is happening. The other is much less formal, but basically a lot of people have suspicions that Huawei or other Chinese companies are or could be spying on the US for the Chinese government. For this one, I totally understand the potential motivation for this, but if I understand correctly, we still haven't really seen any evidence of this happening at all, so it's really more of a "pay close attention and watch out" thing rather than anything we have to react to.

[Techstorm970]

8 minutes ago, kuhnertdm said:

MIT announced yesterday that they will not be renewing deals or accepting new ones with Chinese-based tech companies Huawei Technologies and ZTE Corp for the near future

GOOD!

[kirashi]

12 minutes ago, kuhnertdm said:

Opinion: I want to stress the difference here between the two major allegations against Huawei. The one that's relevant here is that they allegedly tried to circumvent US sanctions against Iran, for which there is some significant evidence showing that this is possible, and for which the investigation is happening.

 

The other is much less formal, but basically a lot of people have suspicions that Huawei or other Chinese companies are or could be spying on the US for the Chinese government. For this one, I totally understand the potential motivation for this, but if I understand correctly, we still haven't really seen any evidence of this happening at all, so it's really more of a "pay close attention and watch out" thing rather than anything we have to react to.

I love how the US & mainstream media continue to fear monger against non-US companies when literally every electronic in the US comes from China or Taiwan... people need to wakeup and do their own research before jumping on the "insecure device" bandwagon, because guess what: anything closed source should be assumed insecure by design as you, the consumer, have no way to verify what the code or hardware has been programmed to do if you can't see the source code or original hardware schematics.

 

As far as I'm concerned, the US is aiding and abetting in anti-competitive practices, except in this case, the government is backing these practices which makes it legal for some reason, even though in any other circumstance it would be illegal.

[Mo5]

When China spies it's crime, when US spies it's for security reasons or sth. OK.

[PlayStation 2]

5 minutes ago, Mo5 said:

When China spies it's crime, when US spies it's for security reasons or sth. OK.

Every country has the goods on everyone.
We have our hands in China. Israel controls the United States. Russia has their hands in Syria. Ain't making it okay, but you gotta understand literally everyone spies on each other.

[Eaglerino]

31 minutes ago, Mo5 said:

When China spies it's crime, when US spies it's for security reasons or sth. OK.

Yes but if we can avoid it why would we allow it

[leadeater]

Quote

MIT is the latest top educational institution to unplug telecom equipment made by Huawei and other Chinese companies to avoid losing federal funding.

lol, well that detail is a bit interesting.

[Taf the Ghost]

18 minutes ago, leadeater said:

lol, well that detail is a bit interesting.

The big schools are mostly funded by the Federal Government, either by grants or via student loans. They're pretty sensitive to those funding sources. Also, MIT is a big DARPA contractor, along with other military research.

 

Still, there's clearly something there that has forced the hands of US security industry. Huawei and ZTE could have lobbied their way through the issues if it was just being on the outs of a bidding wars, so there is still something to the issues. Though it might be more they were always conduits for Chinese Corporate espionage rather than State Security. Considering how much money has been lost to stolen IP, this might be as much as a revenge tour as anything else. (Which would be completely warranted, but that's another topic.)

[leadeater]

5 minutes ago, Taf the Ghost said:

The big schools are mostly funded by the Federal Government, either by grants or via student loans. They're pretty sensitive to those funding sources. Also, MIT is a big DARPA contractor, along with other military research.

I know that, I just find it interesting that is why MIT is doing this and not for some other more specific reason. I mean it's MIT, I'm sure with their vast resources of experts in the field they have at least looked at the equipment but the reason they are stopping using the worlds largest telecommunications equipment provider came down to funding. That is at the very least an interesting detail to take in to consideration.

[Taf the Ghost]

1 minute ago, leadeater said:

I know that, I just find it interesting that is why MIT is doing this and not for some other more specific reason. I mean it's MIT, I'm sure with their vast resources of experts in the field they have at least looked at the equipment but the reason they are stopping using the worlds largest telecommunications equipment provider came down to funding. That is at the very least an interesting detail to take in to consideration.

China bought a lot of military tech through connections they built by buying up influence at the major research universities. It's actually a massive National Security and Investment issue. It's also why the quality of the education at those "major" schools has dropped through the floor. They sell connections not education these days.

[Guest]

39 minutes ago, leadeater said:

lol, well that detail is a bit interesting.

I’m sure it’s just a small detail.

[leadeater]

2 hours ago, Taf the Ghost said:

It's also why the quality of the education at those "major" schools has dropped through the floor. They sell connections not education these days.

Well I think you should be careful making that assertion and make sure it's factually correct. I know many are taking a dim view of a lot of US universities right now, and some of those concerns are justified however those typically apply to specific courses and institutes within those universities. There's an important difference between opinion and actual education outcomes and research output which I have seen no decrease in quality in core educational areas. Look at computer science recently, the amount of security research has been extremely good. The same is true about other scientific fields too. Most of the objections people have are more in the humanities sections more than science and engineering, good feelings and diversity doesn't build bridges .

 

There's actually real risks with wide spread discrediting of educational institutions and in more general terms science, especially when only founded on opinions.

 

Either way I'm not surprised by MIT's decision nor the reason why, longer term as a whole it's pretty stupid to willingly cut yourselves off from industry leaders and best equipment or technology on incorrect claims of risks with the equipment. As I've said before in previous topics, all the actual security risks are people based not equipment and that is evidenced by the referenced incidents used in the bill to put the ban in place. If you can't put adequate measures in place to protect from that then not working with those companies while justified because of that to me is more concerning in itself, it doesn't speak that highly of your security agencies effectiveness to work with companies interacting with Huawei/ZTE to put measures in place to prevent problems.

 

I would have hoped a bit more strategic planning was used, tightening up procurement and tender processes while also increasing funding in to US tech companies to make your own options more appealing and superior products before transitioning to an outright ban. That to me sounds more sensible.

[leadeater]

17 minutes ago, floofer said:

I’m sure it’s just a small detail.

I doubt it, losing funding like that means ceasing to exist.

[CarlBar]

38 minutes ago, Taf the Ghost said:

China bought a lot of military tech through connections they built by buying up influence at the major research universities. It's actually a massive National Security and Investment issue. It's also why the quality of the education at those "major" schools has dropped through the floor. They sell connections not education these days.

 

I think what @leadeater is getting at is that MIT has the means and knowledge to figure out if anything nefarious is going on with those companies interactions with them. Yet the reason they're terminating the partnership isn't because of any security risks they found but because of funding. If they'd found security risks those would be a much bigger area of concern and would naturally have been the justification with the implication that MIT at least has no actual notable security concerns with these companies.

[Guest]

29 minutes ago, leadeater said:

I doubt it, losing funding like that means ceasing to exist.

I’m sure it’s a small detail when it comes to their decision, and they came to this conclusion on their own.

[leadeater]

1 hour ago, floofer said:

I’m sure it’s a small detail when it comes to their decision, and they came to this conclusion on their own.

The article clearly states it's due to losing federal funding if they did not. That in no way says it's not a factor and if you consider how much funding they get from that it's a damn big factor if they were to lose it.

[Billy Pilgrim]

17 minutes ago, leadeater said:

The article clearly states it's due to losing federal funding if they did not. That in no way says it's not a factor and if you consider how much funding they get from that it's a damn big factor if they were to lose it.

Also IIRC universities often work on government projects and severing connections with these companies would make them more appealing to work with.

[Guest]

1 hour ago, leadeater said:

The article clearly states it's due to losing federal funding if they did not. That in no way says it's not a factor and if you consider how much funding they get from that it's a damn big factor if they were to lose it.

I was very much /s, I should have added it, apologies.

[leadeater]

38 minutes ago, floofer said:

I was very much /s, I should have added it, apologies.

I'm not always thick, but when I am I go for maximum density