Sources: AT&T has walked away from a deal to sell smartphones made by Huawei, a partnership that was expected to be announced on Tuesday at CES
Reversal is set back for Chinese electronics giant's hopes to crack U.S. market — AT&T Inc. T .24% has walked away from a deal …
Context & Ripple Effects
The reversal caps weeks of momentum: in mid-December, sources reported Huawei and Xiaomi negotiating with AT&T and Verizon to put their phones on US carrier shelves as soon as 2018, which would have given Huawei its first mass-market distribution deal in America. The AT&T partnership was set to be announced Tuesday at CES.
Within days of the walkaway, the political dimension surfaced openly — lawmakers citing national security concerns urged AT&T to sever commercial ties with Huawei and opposed China Mobile's US entry plans (the January letter), and by month's end Verizon had also scrapped plans to sell the Mate 10 Pro.
First-order effects
- Huawei loses its primary route into the US consumer market on the eve of its CES launch, leaving the Mate 10 Pro without carrier distribution and forcing reliance on unlocked retail channels with far less reach.
- AT&T absorbs no commercial penalty but trades a flagship Android lineup for avoidance of a Washington confrontation it was about to be dragged into.
Second-order effects
- Verizon follows within three weeks, dropping all Huawei handsets including the Mate 10 Pro — once one carrier blinks under government pressure, the others face little upside in being the last one standing.
- Lawmakers widen the front from smartphones to telecom infrastructure itself, opposing China Mobile's US application, signaling that the objection is to Chinese network operators generally rather than any single device.
Third-order effects
- If the pattern holds, national-security review becomes the de facto licensing regime for Chinese hardware in the US carrier channel, regardless of price or product competitiveness — a structural barrier no handset vendor can negotiate around.
- Chinese vendors pivot toward self-reliance strategies (in-house silicon, domestic supply chains) since the largest premium market is effectively closed through official channels, deepening the bifurcation of the global device ecosystem.
The trend: US national-security politics, not product economics, is emerging as the decisive gatekeeper determining whether Chinese technology companies can enter the American market.