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CEO Robbins: Cisco won't use Huawei ban in sales pitch

CEO Chuck Robbins said Cisco won't use the U.S. ban on Huawei exports in sales pitches. Robbins also said the Huawei ban has not had an effect on sales.

SAN DIEGO -- Cisco CEO Chuck Robbins said the company had not benefitted financially from U.S. restrictions on products from Chinese tech giant Huawei Technologies. Robbins has also ordered the sales team not to cite the government's Huawei ban as a reason to buy Cisco networking gear.

Robbins made the remarks at a news conference on Monday at the Cisco Live customer conference. His comments were in response to questions on multiple actions the Trump administration has taken to bar federal agencies from buying directly from Huawei or companies that use its equipment.

"I've told our teams point-blank; this is not a sales strategy for you. I do not want our teams going in and leveraging the geopolitical situation to try and advantage us," Robbins said.

Robbins also said the company had not seen a "material shift" in sales stemming from the U.S. restrictions on Huawei, which the government sees as a security risk because of the company's close ties to the Chinese government.

'Ignorance' about 5G vendors

Without mentioning Huawei's name, Robbins did take issue with analysts who have argued that the government's Huawei ban could slow the rollout of 5G networks globally. Huawei is a leader in the 5G market and a significant innovator in the fifth-generation wireless technology.

I've told our teams point-blank; this is not a sales strategy for you.
Chuck Robbins, CEO, Cisco

"There's a high degree of ignorance about 5G around the world, to be honest," Robbins said. "It's not like there's one vendor that can build 5G networks. This is a fallacy."

Robbins listed Ericsson, Nokia and Samsung as having "great" micro-radio technology and added that Cisco could provide everything else that's needed to build a 5G network.

The U.S. government's Huawei ban could spark a tit-for-tat by the Chinese government against U.S. companies doing business in China, including Cisco.

"Our business in China obviously could be impacted if the Chinese government decided to do things differently relative to U.S. vendors," Robbins said. "We just have to keep operating and see how all that plays out."

So far, the tariffs the Trump administration has imposed on Chinese exports has had a minimal effect on Cisco, which started making changes to its supply chain late last year to avoid the tax as much as possible.

Bullish on India

In regards to other countries, Robbins said he was particularly bullish on India, which he had visited two weeks ago. Several conditions in the country that pleased Robbins included the fact that India was the fastest-growing democracy in the world, had consistent leadership, an educated workforce and a "belief in technology at the highest levels."

"All of those things scream at me, 'This is an investment area for you,'" he said.

Cisco, which started its India operations in 1995, has seven sales offices in the country and a development center in Bangalore that includes a research and development facility.

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What's your opinion of the U.S. government's Huawei ban?
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While there are those that will say "show me the evidence", I can tell you as someone who has had the opportunity to visit China many times and understand how things work in China, it is absolutely valid for any Government or Company doing business with Chinese Tech firms to be concerned about eavesdropping. There is no such thing as a media or large company in China that doesn't have some sort of ties with the Chinese Communist Central Government. And to those out there that want to point fingers at the United States NSA, it's not an apples for apples comparison. The United States system of government does not mandate that private companies enable back doors into their products or turn over IP to the Government or competitors.

All that being said, are there mechanisms that could be put into place to validate Huawei's genuineness in their desire to sell their solutions free of tech that would allow eavesdropping? I would say a good start would be for Huawei to setup shop outside of China and manufacture their products sold to overseas market from these facilities. But at the end of the day, one still needs to scrutinize any large Chinese tech firm and their ties to the Chinese Central Government.
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I agree that western countries should limit the use of Huawei gear to environments where the technology won't pose a national security threat. However, I disagree with the Trump administration's approach to dealing with China and Huawei. We need to be tough at the negotiating table and not use our economic strength as a weapon. I believe the latter tactic alienates our allies and fails to change the behavior of our rivals.

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