The U.S. government is forcing major telecommunications companies, including Verizon and AT&T, to disclose any foreign-made networking hardware or software they are using, and whether they've noticed anything suspicious about it, according to a report by Bloomberg News.
Security experts told Bloomberg that the Obama administration is worried about spyware embedded in Chinese-made network components, which are increasingly used by American companies and are often less expensive than domestic alternatives.
"This is beyond vague suspicions," Richard Falkenrath, a senior fellow in the Council on Foreign Relations, told Bloomberg. "Congress is now looking at this as well, and they’re doing so based on very specific material provided them in a classified setting."
Dozens of companies, including software and information-security firms, got a survey in April from the Commerce Department demanding detailed information about who made their networking components, Center for Strategic and International Studies cybersecurity expert James Lewis told Bloomberg.
Cooperation with the investigation is compulsory, Lewis said. The government is invoking the Defense Production Act, a 1950 law that lets the president direct sectors of the civilian economy in matters related to national defense. Industry groups have already complained.
The survey, which was due to be returned in June but has since had its deadline extended, also asks about breaches of security and any " unauthorized electronic hardware " that the companies might have found.
Bloomberg has obtained access to a copy of the survey, and notes that its results are to be shared with the Defense Department.
There's no mention of any specific foreign company in the survey, but the story makes clear that Chinese networking-component Huawei Technologies is a company of interest.
Huawei has moved aggressively into the global networking-technology market in the past decade, even while it was being sued by American competitors Cisco and Motorola for alleged theft of trade secrets and patent infringement.
American politicians have expressed concerns about Huawei's alleged close ties to the Chinese military. Bloomberg said the Commerce Department survey demanded information about software and firmware update procedures regarding foreign-made components.
"It's the update function that is the core of the concern," Lewis told Bloomberg. "Huawei has offered to let people examine their source code to see if it is clean. ... Of course it's clean, but that's not the delivery vehicle, assuming there is one."