A U.S. intelligence official urged companies to avoid supply chains involving Huawei and said there's a strong push within the administration to bolster domestic production of 5G technologies. Constance Taube, National Counterintelligence and Security Center deputy director, said U.S. companies should approach Huawei and other Chinese state-controlled companies with a high degree of skepticism, saying their supply chains will ultimately benefit from more trusted actors. “It's fair to say that supply chain risk can probably never be entirely eliminated,” Taube said, speaking during a Wednesday webinar hosted by the Intelligence and National Security Alliance. “But supply chain risk must be managed.” Taube said Huawei is “subject to the whims of an authoritarian government,” saying its strong links to the Chinese military should dissuade U.S. companies from trading with it. Recent U.S. restrictions, such as increased license requirements on exports to Huawei and Chinese military end-users, might cause industry pain in the short term, Taube said, but the U.S. will ultimately be better off. China heavily criticized the U.S. restrictions. Taube said the COVID-19 pandemic highlighted the risks of doing business with China and stressed the importance of supply chain diversification. “What we have learned during the COVID crisis is that we are so deeply integrated in terms of supply chains on critical areas, that we may want to rethink and readjust to ensure that when we are in crisis periods, we are well positioned to get through the crisis without a reliance on partners that might not gain full trust.” Though Huawei is the world’s top telecommunication equipment maker, Taube said U.S. companies should turn to other sellers and buyers of 5G technology that are trusted. Taube also cautioned U.S. companies against doing business with other Chinese companies, saying they're subject to “different kinds of scrutiny and different requirements than companies that operate in environments that are democratically managed.” She said it's often unclear which companies are aiding the Chinese government. “Chinese government provides subsidies to their organizations that they feel are vital to their own national or economic security,” Taube said. “And I'm putting it bluntly: They don't necessarily always represent them as subsidies.”
“Ditch the Home Office. Work From Las Vegas,” beckoned an MGM Resorts email Wednesday in a “Viva Las Office” promotion aimed at reinvigorating hotel and casino traffic during the COVID-19 pandemic. All MGM properties in Las Vegas are open except for the Mirage, Park MGM and NoMad, but weekend demand is “far more robust” than on weekdays, said management on a quarterly earnings call this month (see 2007310003). Three “luxury packages” start at $100 a night and include a 20% break on a room that’s “office-ready" with high-speed Wi-Fi and plenty of "video conference ready backdrops.”
House Commerce Committee Chairman Frank Pallone, D-N.J., and Communications Subcommittee Chairman Mike Doyle, D-Pa., urged the FCC to extend the priority window for tribes to apply for 2.5 GHz licenses by another 150 days. The commission agreed in July to extend the tribal window until Sept. 2, drawing criticism from Democratic Commissioners Jessica Rosenworcel and Geoffrey Starks (see 2007310027). Tribal groups sought a six-month extension of the window beyond the earlier Aug. 3 deadline. “We are concerned that the FCC’s failure to provide” an “adequate” extension “means fewer tribes will be connected to lifesaving internet service,” Pallone and Doyle said in a Wednesday letter to FCC Chairman Ajit Pai. “Tribes have been hit particularly hard during the COVID-19 pandemic, and high-speed internet service helps governments better succeed when it comes to public health interventions. The Rural Tribal Priority Window is one important remedy to the digital divide for Indian Country, but without more time, it will not succeed.” The FCC didn’t comment.
The COVID-19 pandemic “shined a spotlight” on the broadband divide and the digital “skills gap” in the U.S., neither showing signs of abating, Microsoft President Brad Smith told an Axios webinar Thursday. Both were “here last year,” but their impact “is even greater in the current economic climate,” he said. American Federation of Teachers President Randi Weingarten joined Smith on the webinar, urging deploying and regulating universal broadband as “a fact of life.”
The New York Public Service Commission will hold Altice to a “higher standard” on disaster resiliency, after problems in the cable company’s response to Tropical Storm Isaias, Chairman John Rhodes said Thursday at a Senate-Assembly joint hearing on utility and communications failures. In California, where wildfires are blazing, the wireless industry sought rehearing Wednesday of a California Public Utilities Commission order requiring 72-hour backup power in certain high-threat fire areas (see 2007160065).
Analog Devices, Inc. (ADI) is seeing “promising evidence that a broad-based recovery is underway” from COVID-19, said CEO Vincent Roche on a fiscal Q3 earnings call Wednesday: “We recognize that the recovery is highly dependent on the future impacts of the pandemic.” The quarter ended Aug. 1. As ADI progressed through the quarter, “we saw stronger than anticipated demand,” plus fewer cancellations and “higher than anticipated backlog conversion,” said Chief Financial Officer Prashanth Mahendra-Rajah. Business-to-business revenue in the quarter was up 11% sequentially from fiscal Q2, he said. Growth was flat year over year, “as strength across industrial and communications offset a sharp decline in automotive,” he said. Communications was 25% of quarterly revenue and was up 14% year over year, said Mahendra-Rajah. ADI had double-digit increases in its wireless and wireline “end markets,” he said: “This strength came from our leadership position in 5G wireless systems and our solid position in optical connectivity used in carrier networks and data centers.” Q3 automotive revenue fell 29% from the 2019 quarter, “with all applications declining due to global factory shutdowns and lower vehicle sales” during the pandemic, said Mahendra-Rajah. Though no company is “immune” from COVID-19, revenue from growing adoption of ADI’s automotive audio bus infotainment platform is up more than 70% “year to date, despite lower vehicle sales,” he said. Revenue in ADI’s consumer business was down 13% from a year earlier, said Mahendra-Rajah. “Relatively flat” revenue from sales of components in portable devices “was more than offset by double-digit declines in prosumer, due to the pandemic-related softness,” he said. “We continue to expect 2020 to be the bottom for our consumer business.” Roche has been in the communications business a long time, dating to the “inception of 2G,” said the CEO in Q&A. “The patterns we’re seeing in 5G are no different than what we saw in 2G, 3G or 4G,” he said. The story of 5G has been about “giving more bandwidth to the consumer,” said Roche. “The future is about B2B, more so, than the consumer. We’re beginning to see the early adoption of 5G in the factory automation area. In fact, I have verified that with some of our industrial automation customers.”
NPD forecasts Q4 consumer tech sales will rise 18% from the 2019 quarter, about twice the level of increase of NPD predictions made at the beginning of the COVID-19 pandemic, Stephen Baker, vice president-technology, told an NPD webinar Wednesday. NPD projects tech sales in first-half 2021 will increase 10% over the comparable 2019, disavowing 2020 as a comparative “baseline” due to the year’s volatility, he said. “While we don’t expect lines of people waiting on Black Friday,” it’s reasonable to expect “lines of cars,” said Baker. About 36% of online sales in Q2 were buy online, pick up in store (BOPIS) transactions, he said. Baker expects “incremental growth” in BOPIS over Thanksgiving weekend, he said. Baker isn't worried that the extraordinary volume of tech sales occurring during the pandemic is “pull-in” demand that will diminish holiday spending later in the year, he said. “In an environment where demand is infinite, pull-in doesn’t really make any difference,” he said. “We keep worrying about this, but the demand remains there. We’re seeing 20% revenue growth every single month for the last five months. Even if that demand is being pulled in, there’s demand behind it.” That’s one of the reasons “we are increasingly bullish” about the holiday outlook, said Baker. “Anybody who knows me knows I was pretty bearish in the early part of this. Our thought process has evolved over time.” The 18% increase NPD expects for Q4 tech revenue growth is an “historic-type number,” he said. “There remains a huge amount of unmet demand that obviates the challenges around pull-in and gives an enormous base to work against.” E-commerce was 70% of consumer tech revenue at the end of Q2, said Baker. That’s about 20 percentage points higher than it was at the beginning of 2020, he said. “Certainly we’re not going to stay there,” but it’s likely that online as a percentage of tech sales will “permanently” stay above 60%, he said.
North Carolina will spend $12 million to spread broadband in 11 rural counties through Growing Rural Economies with Access to Technology (Great) grants and COVID-19 stimulus funding, Gov. Roy Cooper (D) said Wednesday. Receiving Great grants, totaling $10 million, were Atlantic Telephone Membership, CenturyLink, CloudWyze, NfinityLink Communications, Roanoke Connect Holdings, Spectrum Southeast, Sky Wave and Zito Media. Spectrum Southeast also got $2 million in pandemic support. North Carolina is considering six more last-mile projects for stimulus funding, said Cooper's office.
Cree views 5G as a “multiyear expansion, with major traction coming,” said CEO Gregg Lowe on a Tuesday investor call. The company supplies silicon-carbide RF and power chips for 5G infrastructure applications. “There have been a number of recent announcements coming out of Asia pointing towards growing 5G momentum in that region. While the global pandemic has further delayed some rollouts in other regions, we continue to be well positioned to support this global expansion.” Cree stopped shipping to Huawei “for the better part of a year” after the Commerce Department’s export ban took effect, said Lowe: “We have no Huawei revenue plans in any of our future projections or forecasts.” Any “large impact” from Huawei, “we've basically taken it out of the picture,” he said. “We have developed good relationships with other players around the world and are repurposing the technology that we had developed for Huawei for those customers.” Lowe concedes the “Huawei situation was a pretty significant setback for us,” he said. “But we've adjusted our plans, we've adjusted our focus to go after non-Huawei customers.”
Instacart is offering its shoppers free access to Doctor On Demand telehealth screenings for COVID-19, said the online grocery shopping service Wednesday. Shoppers who are “clinically diagnosed” will be eligible to receive up to 14 days of “extended pay” while they quarantine, it said. Instacart shoppers and the Gig Workers Collective threatened early in the pandemic to strike if the company didn’t take proper COVID-19 proper safety precautions (see 2003270048 or 2003270065). It eventually relented and increased benefits and safety protocols.