The latest entry in Huawei’s ongoing struggles to come to the U.S. proved to be one of the more unexpected and engaging CES storylines last week. But there are still plenty of layers of this onion left to peel back. This morning, Reuters is confirming speculation that AT&T’s last-minute decision to pull out of a deal with the Chinese phone maker comes as U.S. lawmakers applied pressure on the carrier.
According to the outlet’s sources, AT&T’s hand was forced when members of Congress lobbied against its plan to offer Huawei handsets through its carrier subsidy program. Lawmakers are reportedly going even further, pushing the country’s second largest carrier to cut more ties with the company.
On the docket are a plan to hash out 5G network standards and a deal with Cricket, a prepaid wireless provider that was absorbed into AT&T back in 2013. The aforementioned lawmakers have also reportedly warned that ties to Huawei and state-owned telecom company China Mobile could jeopardize potential contracts with the government.
The report is certainly in line with a 2012 House Intelligence Committee report, which flagged both Huawei and ZTE as potential security risks, stating, “Private-sector entities in the United States are strongly encouraged to consider the long-term security risks associated with doing business with either ZTE or Huawei for equipment or service.”
On Friday, Texas Republican U.S. Rep. Michael Conaway introduced a bill seeking to prohibit the U.S. government from working with any carriers using either Huawei or ZTE handsets. That arrived a few days after Richard Yu seemingly went off script at a CES keynote to excoriate U.S. carriers for refusing to work with Huawei, stating, “it’s a big loss for consumers, because they don’t have the best choice for devices.”
Huawei clearly had big plans for a U.S. push this year, including a huge ad campaign featuring Wonder Woman actress, Gal Gadot. Without the support of a carrier, such an aggressive push will be something of a nonstarter in a country where most phone purchases are still made through service providers.