Attorney General: US Should Buy Nokia, Ericsson for Huawei Battle
Barr suggests US govt take control of major foreign telecoms
Jason Ditz
In comments that appear far-afield of his normal law enforcement duties, Attorney General Bill Barr suggested in a speech on the “threat” of China that the US government should buy out control of Nokia Corporation and Telefonaktieboladget LM Ericsson (generally referred to as Ericsson) and use them to fight against China’s Huawei Technologies.
The Trump Administration has long viewed Huawei with hostility, and has been making the rounds internationally, threatening and cajoling other nations not to do business with Huawei on 5G infrastructure.
The problem is, Huawei is broadly the market leader in telecommunication infrastructure, and the preferred option for many in 5G transitions. US objections are generally not to Huawei’s competence, but rather to them being Chinese, leading the administration to claim they’re a spying risk.
Barr suggests that Nokia and Ericsson could compete better with Huawei if they had the financial might of the Federal government behind them. But they’d need to be American companies to do that, and Barr says they should be either outright state-controlled by the US, or held through a consortium of private US corporations that would make them quasi-state-controlled.
It’s not clear how this could be achieved. Nokia is a $23.8 billion corporation, and Ericsson is another $27.3 billion. As they are Finnish and Swedish, respectively, there is no obvious mechanism by which the United States could nationalize other nations’ major telecommunications companies.
There is also no apparent precedent for the US engaging in this sort of corporate warfare as a government policy, trying to nationalize other companies to attack a foreign company they are generally hostile to.
Even if Barr can eliminate all of the obvious objections and turn one or both companies into a US government-run enterprise to compete with Huawei, the US talking points might be even more damaging. After all, the NSA surveillance scandals have shown that US telecoms are constantly being used for US spying activities, and if that is true of private US companies, it would only be a vastly bigger concern if the US government itself became the service provider.
The Trump Administration has long viewed Huawei with hostility, and has been making the rounds internationally, threatening and cajoling other nations not to do business with Huawei on 5G infrastructure.
The problem is, Huawei is broadly the market leader in telecommunication infrastructure, and the preferred option for many in 5G transitions. US objections are generally not to Huawei’s competence, but rather to them being Chinese, leading the administration to claim they’re a spying risk.
Barr suggests that Nokia and Ericsson could compete better with Huawei if they had the financial might of the Federal government behind them. But they’d need to be American companies to do that, and Barr says they should be either outright state-controlled by the US, or held through a consortium of private US corporations that would make them quasi-state-controlled.
It’s not clear how this could be achieved. Nokia is a $23.8 billion corporation, and Ericsson is another $27.3 billion. As they are Finnish and Swedish, respectively, there is no obvious mechanism by which the United States could nationalize other nations’ major telecommunications companies.
There is also no apparent precedent for the US engaging in this sort of corporate warfare as a government policy, trying to nationalize other companies to attack a foreign company they are generally hostile to.
Even if Barr can eliminate all of the obvious objections and turn one or both companies into a US government-run enterprise to compete with Huawei, the US talking points might be even more damaging. After all, the NSA surveillance scandals have shown that US telecoms are constantly being used for US spying activities, and if that is true of private US companies, it would only be a vastly bigger concern if the US government itself became the service provider.
posted by Satish Sharma at
11:19
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