Huawei research ties with world's top universities at risk from US advice

China’s telecoms giant Huawei has been building research collaborations and spending millions of dollars setting up joint centres for high-end research with universities in advanced countries in recent years, expanding such collaborations from Europe to North America, Southeast Asia and elsewhere.

Huawei is one of the world’s top spenders on research and development, currently investing 15% of its annual revenue of around US$93 billion globally in R&D or around US$13.8 billion in 2017, both internally and in collaboration with universities and research centres. It has stated plans to push this up to US$16 billion annually in future.

But the United States administration under President Donald Trump has focused on intellectual property theft and technology competition with China and has trained its spotlight on Huawei.

Last year the administration advised US allies, in particular the other ‘Five Eyes’ countries – the United Kingdom, Australia, New Zealand and Canada, all signatories of the 1947 UKUSA Agreement or secret treaty on sharing intelligence – to scrutinise research collaboration with Chinese companies, naming Huawei among them.

This could herald a significant downturn in Huawei’s research collaboration with universities in these countries.

This view was reinforced last month when the University of Oxford announced that it was suspending future collaboration with Huawei. Oxford said it would continue its existing research contracts with combined funding of £692,000 (US$908,000) and would review the relationship with Huawei in three to six months.

In addition, in an email to IT students, the university cautioned students not to share confidential information with the company, though it did not go as far as to ban contact with the company.

This has been a major blow to Huawei’s reputation as a research partner, painstakingly built up over many years and becoming more ambitious. It recently paid £35.7 million (US$46.8 million) for a site in Cambridge for a major new R&D campus that would tap into the University of Cambridge’s cutting-edge research and start-up ecosystem.

A University of Cambridge spokeswoman said the university could not comment on private property transactions. However, she said the university was aware of Oxford University’s ban on further research grants from Huawei. “We review all of our relationships regularly and this case is no exception,” she said.

The sensitivity of Huawei collaborations has come to the fore even more strongly in recent weeks as the US is seeking the extradition from Canada of Sabrina Meng Wanzhou, Huawei’s chief financial officer and daughter of its founder Ren Zhengfei, over alleged violations of US sanctions on Iran.

In the wake of this development, British lawmakers also urged UK universities to exercise “extreme caution” in accepting funds from Huawei amid growing international concern about a possible security threat.

US' concerns

The United States Congress has also targeted universities’ partnerships with companies like Huawei in recent months, with several congressional panels examining alleged attempts by foreign actors to infiltrate American universities, seen as a form of high-tech espionage to grab federally-funded research by the back door

Last June, some 26 members of the US Congress, in a letter to Education Secretary Betsy DeVos, asked her to investigate Huawei’s investments in US universities.

“Research partnerships with US universities are a primary mode of ‘China’s Toolkit for Foreign Technology Acquisition’,” the letter said and pointed particularly to the Huawei Innovation Research Program (HIRP). According to Huawei, the programme has covered more than 300 universities from more than 20 countries, with some 1,200 projects funded globally in the past decade. They include most of the world’s top 100 universities.

Mainly geared towards fundamental research, HIRP was first launched in 2010 in Europe, before expanding to other advanced countries, and brings together “internationally renowned leading researchers” for the purpose of exploring cutting-edge topics, in workshops and summits. Its stated aim is to “support novel and early stage research ideas in ICT fields”.

The scheme provides one- to two-year research grants worth US$30,000 to US$70,000, and large and multi-year contracts, usually on an “invitation-only basis”. It claims Nobel Prize laureates and Fields Medal winners as partners. A number of top universities in the US, the UK and Canada have confirmed that they were approached by Huawei to take part in the scheme, rather than the other way around.

"Contrary to what some have alleged, Huawei is not after our partners’ patents or research results,” according to a commentary article signed by Meng for Japan’s Nikkei Asian Review released this week.

She cited examples of successful commercialisation of this research, such as a noise cancelling technique developed with the Technical University of Munich and an approach to reducing power consumption created with Josef Nossek of the German Academy of Science and Engineering. "Huawei will continue funding basic research that leads to advances in science and technology," Meng said.

The US receives a relatively small amount under the scheme – estimated at around US$10 million. But other countries, such as the UK and Australia, are bigger beneficiaries.

Eric Xu, the rotating chairman of the Huawei board, has described the lawmakers’ claim that research cooperation was a threat to national security in their letter to DeVos as “ill-informed”.

‘Public good’ or ‘threat to America’?

Xu said in a comment published last year that US federal funding for research in universities has fallen steadily over the past decade with corporate sponsorship from companies such as Huawei providing much of the rest. And he described the fruits of the research as constituting “a public good rather than a threat to America”.

Another Huawei scheme with universities is ‘Seeds for the Future’. Launched a decade ago with its first programme in Thailand, it has benefited more than 30,000 students from more than 350 universities, representing 108 countries and regions, as of the end of 2017, bringing students to Huawei headquarters in Shenzhen on a short-term basis, teaching mandarin and providing exposure to Huawei practices and equipment.

“Our collaboration with universities gives college and postgraduate students the chance to receive training and hands-on experience. We provide this support with no expectation of direct commercial return,” said Xu in a commentary published in various newspapers, including in the Financial Times last year.

5G concerns and openness to collaboration

The US is not alone in being concerned about Huawei’s dominance in 5G technology. Countries such as Sweden, Germany and Japan are also reviewing Huawei participation. The UK currently allows Huawei into its market, as long as it agrees to open up its equipment to third-party inspection.

But even countries such as Australia and New Zealand, which have banned Huawei from competing for their 5G networks (like the US which bars Huawei from government telecoms and IT contracts on security grounds), are willing to continue with university research collaborations.

Despite close scrutiny into China-links in general in Australia and warnings to Australian universities as far back as 2016 against dependence on Chinese donors, new research and training contracts are still being signed with Huawei.

These include a new joint academy with Southern Cross University which opened just last month to enable its IT students “to attain qualifications in Huawei technology” based on equipment supplied by Huawei.

Huawei previously set up the public university’s high-tech data and communications network. In the wake of Australia’s ban on Huawei bidding for its 5G network, the university said its IT security is regularly reviewed by the Audit Office of New South Wales.

Huawei has also worked with universities such as the University of Sydney, the University of Technology Sydney and the University of New South Wales, though it has been focusing more on skills training, usually using Huawei equipment as part of a bid to spread its own telecoms and IT standards globally, rather than research.

Canadian concerns rising

The Canadian government is still reviewing its policy on procurement contracts in the communications and IT sector, particularly whether to follow others with a ban on Huawei competing for 5G but has so far not asked universities to stop working with Huawei, despite warnings by its intelligence services.

Last month Canada’s Globe and Mail newspaper revealed that officials from the Canadian Security Intelligence Service (CSIS) met with research vice presidents from 15 leading Canadian research universities in October to discuss security concerns over Huawei’s research partnerships.

Ward Elcock, a former CSIS director and former deputy minister of national defence, echoed US’ concerns when he told Canada’s CBC network in January that he believed the company was “essentially under the control of the Chinese government” and that it was hard to believe it would not do the regime’s bidding, including building “traps, back doors into its technology on behalf of the Chinese government”.

An investigation last year by Globe and Mail said Huawei had contributed around CA$30 million (US$22.5 million) to 13 research universities in Canada and estimated that “more than 100 professors and graduate students” had worked on Huawei projects in Canadian universities in recent years.

In “at least 40 cases” all intellectual property rights were assigned to the company, according to the newspaper.

In 2017 Huawei said it would spend US$10 million until 2020 in Canadian universities. For example, Huawei has contributed CA$3.5 million to the University of Toronto for research over the past two years, with the first such deal in 2016.

Despite Canada being embroiled in the Meng case, universities so far seem set to continue their collaborations with Huawei. In a research collaboration agreement with the University of British Columbia in Vancouver, signed in October 2017, Huawei committed to invest between CA$2.5 million and CA$3 million over the next three years on new projects and “ongoing 5G research initiatives”.

Just last week, Queen’s University in Kingston, Ontario, accepted new research funding from Huawei, despite the CSIS warnings, although it would not comment on the specifics of the research or the amount of funding.

Things could change if the US puts more pressure on its allies. “As a full member of the NATO alliance and dependent on the US economically, Canada would not have much choice” if asked to abandon research with Huawei, says Qiang Zha, associate professor of education at York University in Toronto.

“Mainstream Canadian critics have been cautious about Chinese high-tech, specially for communications,” he says.

But Qiang adds that the debate is somewhat confused. “On the one hand, those critics don’t have evidence that Huawei is threatening anyone’s security; on the other hand, the law in China is that anyone in business must cooperate with the government in the case that national security is threatened, which is a different practice from Western societies,” said Qiang.

According to Chinese law, any individual or enterprise, not just state-owned enterprises, “shall support, assist and cooperate with national intelligence work, and guard the secrecy of any national intelligence work of which they are aware”.

Nonetheless Qiang believes there is far more transparency in collaborations with universities than Huawei’s business-to-business collaborations. “In Canada we have procedures and policies [for universities] which cannot be manipulated. They have to be accountable.”

UK universities still committed

Despite the University of Oxford’s move, a number of UK universities with Huawei-funded collaborations have reiterated their commitment to Huawei contracts. They include the University of Edinburgh, the University of Surrey, Imperial College London, the University of Manchester and others.

The University of Edinburgh received almost £2.8 million (US$3.7 million) from Huawei in June to set up a joint information and technology lab, making Huawei its largest overseas corporate donor, according to the university’s annual review.

It is not ready to scupper that relationship yet. "The partnership has undergone a rigorous process of due diligence and is the result of long-term collaboration between experts at the University of Edinburgh and Huawei,” a spokesperson for the university said.

Some 17 UK universities receive funding from Huawei, which said last year that it would spend some £3 billion over five years in the UK, including both research and procurement.

But the picture in the UK is complicated by Brexit, where universities stand to lose substantial European Union research funding and need new partners, according to David De Cremer, a former KPMG professor at Judge Business School, University of Cambridge, who has carried out research into Huawei.

Huawei’s land acquisition in Cambridge would have been planned well before current developments, De Cremer says. But Huawei is there for solid reasons, including the innovation ecology around Cambridge with strong connections between entrepreneurs and start-ups, and the university.

“You see many start-ups and this attracts companies from outside the UK as well because they invest in the idea generation of those start-ups, many of them closely affiliated to the university,” says De Cremer, who is currently provost chair at National University of Singapore (NUS) Business School.

High-tech companies also focus on well-equipped state-of-the-art laboratories at universities where products and materials can be developed and tested. “Some universities are very specialised in this,” De Cremer says. “Just like any other company, Huawei would try to see who is best in delivering this.”

This includes the Imperial College-Huawei Data Science Innovation Lab, with Huawei contributing to cutting-edge equipment including next-generation cloud computing servers, a research and innovation fund and operational costs for the new lab.

Huawei’s Xu has featured prominently in US media recently defending Huawei’s position, including on CNN, in the Financial Times, and in a paid-for post in the New York Times.

“It often takes decades or even hundreds of years of effort in research and development to translate science or theories into something that is available in the market,” Xu said on CNN, adding: “Huawei does not have exclusive access to what comes out of these partnerships. We benefit, as everybody else does, from the general advancement of science and technology.

“Science has no national borders, and we hope the results from our university partnerships will ultimately benefit everyone in the world. Huawei never seeks to own their research results,” he said.