Lenovo is getting caught up in the same anti-foreign uproar that led to the scuttling of a deal earlier this year that would have seen a Dubai-owned company become actively involved in U.S. port operations.
Last week, CDW announced it had won a contract that would provide 15,000 Lenovo-made PCs to the U.S. State Department. It wasn’t long before critics were saying the deal threatened U.S. national security because Lenovo happens to be owned in part by Chinese interests.
Forget the fact that Lenovo’s acquisition of the former IBM personal computing division last year had to clear all kinds of U.S. security checks.
Also, overlook the fact the computers are being assembled in part in Raleigh, where Lenovo has a major part of its operations.
Further, don’t recall that Lenovo is relocating its headquarters to Morrisville from New York and its chief executive officer, a former Dell executive living in Singapore, will be based in North Carolina.
Here’s what Michael Wessel, head of the US-China Economic and Security Review Commission (USCC), whose members are appointed by Congress, told the BBC on Monday:
“If you’re a foreign intelligence service and you know that a [U.S.] federal agency is buying 15,000 computers from [a Chinese] company, wouldn’t you look into the possibility that you could do something about that?” he said.
Lenovo quickly responded, as documented in both the BBC story and in a report from ComputerWorld.
“Lenovo’s participation in the CDW contract, its ownership, and the sourcing of the units were all disclosed and discussed with the State Department, and the national security implications of Lenovo’s ownership of IBM’s PC division were exhaustively reviewed last year,” Lenovo said in an e-mail quoted by Computer World. … Lenovo products sold to U.S. government customers all have been certified for security and integrity as required to qualify for government procurement.”
Lenovo has also denied that it is controlled by the Chinese government.
“We have nothing to hide,” Jeff Carlisle, vice president of government relations for Lenovo, told Reuters.
However, the debate continues to rage.
A U.S. Congressman is calling for a review of the Lenovo deal based on concerns Lenovo may have an unfair pricing advantage. Donald Manzullo said he wants a review of the contract to discover if Lenovo is providing subsidized computers. He noted that Lenovo is owned in part by the Chinese Academy of Sciences, which is part of the Chinese government.
“’My big concern there is if you have these state-owned enterprises that don’t have to make any money, they can underbid to gain market share,” Manzullo told The Wall Street Journal.
The dark side of the discussion can be found at Betanews.com where several respondents to the Lenovo story lashed out at the Chinese.
Be forewarned. Some of the language is not nice.