Best Buy has just made Huawei’s tough year a lot worse. The Chinese company has already dealt with government pressure and scrutiny that's resulted in the dissolution of a proposed deal with AT&T, and an all-out warning by the heads of multiple U.S. intelligence agencies. On Thursday, Best Buy, one of its biggest partners, has said it won’t be selling Huawei phones anymore.
As first reported by CNET and confirmed by the Wall Street Journal, Best Buy plans to stop selling the Mate 10 Pro in stores and on its website once the current stock dries up. According to the reports, Best Buy has stopped ordering new handsets from Huawei and will no longer sell its products over the coming weeks.
That leaves precious few outlets to buy Huawei phones in the U.S., and none that let you try it out ahead of time. Because Huawei is a relatively unknown brand in the United States, a presence on Best Buy’s shelves was a crucial way to get some visibility among American consumers, the large majority of which still buy phones from physical stores. It's unclear whether cheaper Huawei offshoot Honor will be part of the decision.
This is just one more lump for Huawei in a bruising year. Ahead of a CES announcement in January, AT&T pulled out of a proposed deal to sell the Mate 10 Pro in its stores, and Verizon followed suit. Then the heads of the FBI, CIA, and NSA issued a warning against buying Huawei phones, charging that the company could be using its handsets to gather sensitive data for the Chinese government. Huawei has repeatedly denied these claims, but a 2012 investigative report by the House of Representatives Intelligence Committee paints a bleak picture of Huawei's ties to the Chinese government.
Huawei is set to unveil its new P20 flagship phone on March 27, rumored to feature an iPhone X-style notch. Last year’s P10 didn’t launch in the United States. After today’s news, it’s hard to imagine the P20 will launch here, either.
Why this matters: Huawei has been fighting to crack the U.S. market for years, but it seems nearly impossible now. It was hard enough without carrier support, but Best Buy is one of the biggest brick-and-mortar shops in the country. Now Huawei has to rely on Amazon and other digital outlets to sell its phones, which is an even tougher proposition. Huawei may be the No. 2 or No. 3 phone maker in the world, but most U.S. buyers have never heard of them and are unlikely to spend $700 based on a description or even a glowing review. Best Buy's decision could very well be the last straw for Huawei’s U.S. ambitions.