ZTE Device Called American Spurned After China Spy Angst

[InfoSec News <alerts () infosecnews org>]

http://www.bloomberg.com/news/2013-09-19/zte-device-called-american-spurned-after-china-spy-angst.html

By Kathleen Miller
Bloomberg.com
Sep 19, 2013

The U.S. government stripped a videoconferencing system contract from a 
Maryland company after a federal agency said the device marketed as 
American-made is really Chinese.

The technology is produced by Shenzhen-based ZTE Corp. (000063), China’s 
No. 2 phone-equipment maker. It worked with CyberPoint International LLC, 
a small business based in Baltimore, to make its videoconferencing device 
available to U.S. agencies via contract. CyberPoint’s Prescient unit built 
and installed firewalls in the system, which it said "substantially 
transformed" the product.

U.S. Customs and Border Protection disagreed, saying the government should 
treat the products as Chinese, according to a ruling published today in 
the Federal Register. The decision is the latest impediment to U.S. growth 
for ZTE, which was effectively blacklisted last year by a congressional 
committee that said its products may aid Chinese spying.

"It’s somewhat devastating for them," said Ray Mota, founder of Gilbert, 
Arizona-based ACG Research, a networking-equipment industry consulting 
company. "They'll have to re-strategize on how to approach this market and 
come up with alternatives."

[...]

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