Huawei ramps up foreign university investment despite US pressure

Yuan Yang in Hong Kong MARCH 24, 2019

Huawei is ramping up investment into foreign universities, despite US lawmakers pressuring academic institutions to cut ties with the Chinese telecoms group.

“Our collaborations with universities, especially in basic research, not only will not stop, but will increase,” Huawei board director William Xu said in an interview on Friday, disclosing for the first time that Huawei spends more than $300m per year on university funding and partnerships.

Several elite universities in the US and UK, including Stanford and Oxford, have cut ties with Huawei and refused funding in recent months after the US government issued a criminal indictment accusing Huawei of stealing American technology and breaking US sanctions against Iran.

The US has also issued a ban on government agencies buying equipment from the Chinese company and called on allies to do the same, arguing that the technology could be used by Beijing for spying. Huawei has denied such allegations and is suing the US government over the ban.

Mr Xu played down the impact of universities cutting ties with the company on Friday, saying they had faced “interference” and “although they think co-operation is win-win with Huawei, they are temporarily suspending co-operation”.

“Scientific research should be the joint knowledge creation of human beings, and should not have any geographical labels and political labels,” he added.

Earlier this month, Jim Banks, a Republican Congressman from Indiana, proposed US legislation that would increase intelligence agencies’ scrutiny on research partnerships with Chinese companies such as Huawei and its competitor ZTE, who he described to the Washington Post as “snakes in the grass”.

But Mr Xu said that more than 80 per cent of its investment in US universities was categorised as “gift money” or “funding money” for basic research, with no conditions attached.

“Huawei does not need results and does not need ownership rights,” he said. “Huawei does not require students to join Huawei after graduation either. We are completely open.”

He said that the rest of Huawei’s research funding was for joint research ventures on “key technologies or innovations”, with intellectual property rights divided among the relevant parties.

Mr Xu pointed to Huawei’s joint partnership with BT and researchers at Cambridge university, describing it as “a very good model” for academic partnerships. When Cambridge announced the £25m partnership in 2017, it said researchers were “expected to focus on projects relating to photonics, digital and access network infrastructure and media technologies”.

“The three parties have a joint venture agreement. Each provides researchers. It’s proceeding well,” Huawei said.

Chen Baiqiang, technology transfer manager at Beijing Institute of Technology, likened Huawei’s co-operation with universities in early-stage research to the role of an angel investor.

“If you have the vision and invest in the right project, it’s very low cost and can bring huge returns,” he said.

Xu Sai, a consultant at Dr Technology, a technology transfer company set up by the Chinese government, said China was “severely lacking in fundamental research” and that Huawei’s investments in universities’ research programmes were “more cost effective than doing it itself”.

Additional reporting by Nian Liu in Beijing

This piece was first published in the Financial Times.