China's maligned Huawei gaining global reach

China's Huawei Technologies has evolved into the world's second-largest provider of telecom and Internet innovation, nevertheless some critics suspect it of ties with the Chinese military and of getting behind-the-scenes assistance from the government.

Revenue: Reported $28 billion in revenue last year and $15.2 billion while the first half of 2011, an 11 percent increase from the previous year

SHENZHEN, China — The intensity of this nation's tech ambitions are apparent on the sprawling campus of Huawei Technologies, whose youthful employees play hard on basketball courts afterwards working hard to create telecommunications innovation for what they hope will be China's first major global company.

Reseller of low-end telephone equipment

Started 24 years ago as a reseller of low-end telephone equipment, Huawei has evolved into the world's second-largest provider of telecom and Internet research, and is considered a national champion by Chinese authorities. During some American national-security officials suspect it of having ties to the Chinese military, others accuse it of getting unfair assistance from the Chinese government, and the tech conglomerate has become a competitive threat to Silicon Valley giants Cisco Systems, Juniper Networks and Hewlett-Packard.

Though it so far has failed to land a big deal in the United States because of pressure from Washington, Huawei has become a major force in the global telecom market and is developing high-end Internet research and other products, just as videoconferencing systems, for businesses and governments.

While industry observers believe Huawei, an employee-owned company that reported earnings of $28 billion last year, on the whole lacks the innovative edge of Cisco and other leading tech companies, there is no doubt the Chinese company seeks to become a dominant global player. Near half its 120,000 employees, including about 500 in Santa Clara, Calif., focus on technology and development.

Significant share of the market for handsets

It as well has carved out a significant share of the market for handsets and tablet computers, and it expects to sell 20 million smartphones globally this year.

Huawei's headquarters is a far cry from the typical Chinese assembly-line operations like nearby Foxconn, the maker of everything from iPhones to laptops. It's a cross between a university campus and a resort, with living quarters for thousands of workers, as so then as swimming pools, basketball courts, a large outdoor karaoke stage and other so then-maintained recreational facilities. Employees, whose average age is 31, are known for working long hours to increase the value of their stake in the company, which is ranked as one of China's best employers.

"They even copied their bugs, for God's sake," said Ray Mota, managing partner at ACG Innovation, a telecom business consulting and services company. "Their products were very, very low quality. Nevertheless over the years, they have gotten better and better. They are not quite there but, yet it's a matter of time. It's a scary proposition if you are Cisco, Juniper, Alcatel-Lucent."

Fairly or not, Huawei is viewed by some as a proxy of China's Communist government. Media-shy founder and Chairman Ren Zhengfei was an engineer in the People's Liberation Army 25 years ago. Huawei, facing a wall of opposition from some members of the U.S. Congress and former Commerce Secretary Gary Locke, now the American ambassador in China, has but to win a contract with top U.S. telecom carriers, although it supplies equipment to 45 of the world's top 50 telecoms. U.S. regulators have blocked it from making acquisitions and early this year pressured it to retreat from plans to buy the assets of Santa Clara-based cloud-computing company 3Leaf Systems.

The moves are part of a broader campaign

The moves are part of a broader campaign by Huawei to address concerns about its alleged ties to the Chinese military. In February it issued an open invitation for the United States government and anyone else to investigate its businesses operations. It recently released information about the makeup of its board, reducing some of the secrecy shrouding the company.