The Snowden incident, it s become a real concern, especially for top leaders. In some sense the American government has some responsibility for that; (China s) concerns have some legitimacy.
— Tu Xinquan, associate director of the China Institute of WTO Studies at the University of International Business and Economics in Beijing. China has dropped American tech companies such as Apple, Intel and McAfee from its approved state-purchase lists. Most affected is Cisco Systems: The San Jose company had 60 products on the list in 2012 but by late 2014 had none, according to Reuters.
We have previously acknowledged that geopolitical concerns have impacted our business in certain emerging markets, a Cisco spokesman told Reuters. In fact, when a report from the Edward Snowden leaks alleged the NSA bugged Cisco products before they were delivered to the company s customers, CEO John Chambers complained to President Obama.
It wouldn t be a stretch to say the Snowden leaks, which led to reports of massive NSA spying, could be a factor in China s dumping of U.S. tech products. As I wrote last year, Chinese state media called U.S. tech giants pawns of the U.S. government and vowed to strengthen technology safeguards and severely punish the pawns.
Citing cybersecurity concerns, China also is adopting new rules that would require tech companies to turn over source code and build backdoors into products they sell in China — something U.S. business groups are protesting.
But according to Reuters, Western executives and others say the security concerns are a pretext, and China just wants to boost its own companies.
Industry insiders also see in the changing profile of the CGPC list a wider strategic goal to help Chinese tech firms get a bigger slice of China s information and communications technology market, which is tipped to grow 11.4 percent to $465.6 billion in 2015, according to tech research firm IDC.
Remember Huawei? The Chinese networking-equipment maker was forced out of doing business in the U.S. a couple of years ago after it was declared a possible security threat by the U.S. House of Representatives Intelligence Committee. Huawei is a Cisco competitor.
Photo by Paul Sakuma/Associated Press archives
