The United States government is seeking to develop a homemade alternative to Huawei Technologies Ltd.'s software for the fifth-generation wireless telecommunications networks.
President Donald Trump's administration is working with technology and telecommunications giants, including Microsoft Corporation (NASDAQ: MSFT), Dell Technologies Inc. (NYSE: DELL), AT&T Inc. (NYSE: T) as part of the efforts, White House economic advisor Larry Kudlow told the Wall Street Journal.
"The big-picture concept is to have all of the U.S. 5G architecture and infrastructure done by American firms, principally," Kudlow told the Journal. "That also could include Nokia Corporation (NYSE: NOK) and Telefonaktiebolaget LM Ericsson (NASDAQ: ERIC) because they have big U.S. presences."
The companies will need to agree on common engineering standards so that developers can use any hardware to run the software codes, the Journal noted.
US Will Be Left Behind, Says Huawei
The U.S. government's latest move is in line with its insistence on Huawei being a national security threat. The President and bipartisan legislators have suggested that the telecom giant spies for Beijing.
The Department of Commerce put Huawei on the "entity list" in May last year, which severely restricts its ability to do business with U.S. companies.
Huawei's U.S. chief security officer told the Journal that America would hurt itself by sidelining the company, as it gets left behind on technology.
"If the U.S. wants 5G hardware and software developed by a U.S. or European company, the government should encourage companies to begin negotiations with Huawei to license our 5G technology," Purdy told the Journal.
"[The] combined product will be 1-2 years behind the comparable Huawei products in terms of functionality and assurance," if the U.S. avoids Huawei's intellectual property, the official said.
Ignoring American clampdown against Huawei, the United Kingdom recently gave the company permission to build part of its 5G network.