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President Trump's Huawei risk

Moving the Market: President Donald Trump's decision to bar U.S. corporations from doing business with Huawei (following a 90-day reprieve) will deal a short-term blow to the Chinese telecom manufacturer but could create long-term risks for the United States, national security experts tell me.

• The big concern: The move to isolate Huawei will incentivize China to accelerate its 5G ambitions and may even inspire them to retaliate against U.S. companies. If Huawei's rivals fail to keep pace, it could leave the U.S. at a disadvantage.

• "The country needs to think deeply about the second- or third-order of consequences that will play out over the next five to ten years," Jim Baker, the former FBI general counsel and Director of National Security & Cybersecurity at R Street Institute, tells me.

• “We're entering a very precarious time," says Naomi Wilson, the senior director of policy for Asia at the Information Technology Industry Council. "[The U.S.] should do all it can to avoid giving the Chinese an excuse to retaliate against U.S. companies."

State of play: There are really only three manufacturers in the world that are truly capable of creating top-tier 5G architecture in the near-future: Huawei (China), Nokia (Finland) and Ericsson (Sweden). But Huawei is already months or years ahead of its rivals in being able to actually implement the technology.

• The problem: The U.S. intelligence community believes Huawei's control of 5G networks would give Beijing the ability to spy on U.S. citizens and threaten American infrastructure.

In the short term, then, isolating Huawei seems like a smart decision. It protects U.S. citizens and also hobbles Huawei's ability to sell smartphones. But there are long-term consequences that may play out in the years to come:

• China may look for ways to retaliate against the U.S. technology infrastructure, possibly by depriving U.S. businesses of natural resources needed to create hardware.

• If Nokia and Ericsson fail to keep pace with Huawei, U.S. network providers like AT&T, Verizon and T-Mobile may not have access to the best 5G.

• If Huawei loses its licensing agreements with U.S. companies like Google, it can still create its own services. In fact, it has already started doing this.

• If U.S. suppliers can no longer do business with Huawei, they will cede those opportunities to non-U.S. companies will fill the void.

• Oh/and: The U.S. will not be able to stop Americans from sharing data on Huawei networks when they travel abroad or correspond with people in other countries.

The big picture: Huawei may be a national security threat, but that doesn't necessarily mean cutting them off from the U.S. makes the country safer.

• The U.S. will need to find a more nuanced approach to dealing with Huawei or lean heavily on companies like Nokia and Ericsson to make gains in the 5G market.

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U.S. has Hikvision in sights

Big in the Beltway, big in Beijing: The Trump administration is considering blacklisting a Chinese video surveillance firm from buying American technology, NYT's Ana Swanson and Edward Wong report.

• The move "would effectively place the company, Hikvision, on a United States blacklist" and mark another step in the White House's "attempt to counter Beijing’s global economic ambitions."

• "It also would mark the first time the Trump administration punished a Chinese company for its role in the surveillance and mass detention of Uighurs, a mostly Muslim ethnic minority."

What's next: Heightened tensions.

🍸 Rally the Market 🍸

Soon to be overheard at a dinner party: "People keep comparing the U.S.-China tensions to the Cold War, but it's actually a lot more like the War of 1812."

• Bonus: Tom Friedman says "China deserves Donald Trump."

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Alex Stamos riles Facebook

Big in the Bay: Former Facebook security chief Alex Stamos says Mark Zuckerberg should step down as chief executive, a remark likely to reignite scrutiny over the founder's unchecked power.

• The comment comes less than two weeks after Facebook's founding spokesman Chris Hughes said Zuckerberg had "too much power" and called for the company to be broken up.

Stamos, at the Collision Conference:

• "There’s a legit argument that he has too much power and needs to give up some of that power."

• "If I was him, I would go hire a new CEO for the company... a CEO that can help signal both internally and externally that the culture has to change.”

• Stamos proposed that Zuckerberg give the position to Microsoft president Brad Smith, someone the Facebook chief has consulted for advice in the past.

The big picture: Zuckerberg's power at Facebook is hardly in dispute, and there's a strong argument to be made that the company would benefit if he resigned from the chief executive duties in order to focus on product. (There's an equally strong argument to be made, I think, that it wouldn't.)

• That said, Zuckerberg's true power doesn't reside in his role as chief executive. It resides in his control of the board. With the majority of voting rights, he's the only person who can decide whether or not he should serve as chief executive.

Market Links

• Sundar Pichai changes Google's abortion ad policy (NYT)

• Brian Roberts is working on an in-home health device (CNBC)

• Ev Williams has his eye on media acquisitions (Cheddar)

• Nancy Dubuc brings Cory Haik to Vice Media (Variety)

• Rahm Emanuel joins ABC News, The Atlantic (Daily Beast)

Chip Somodevilla/Getty

Hope Hicks subpoenaed

Big in L.A., big in the Beltway: Hope Hicks has been called to testify before the House Judiciary Committee, an unwelcome return to Washington for the former Trump aide who has since joined the Murdochs' Fox Corporation as communications chief.

• The committee says Hicks was a "critical witness" to the "alarming misconduct and obstruction of justice by President Trump" that was detailed in the Mueller investigation.

• The Washington Post's Phil Rucker calls Hicks "the big get, the star witness" for the Democrats."

What's next: Hicks has been asked to testify on June 19.

Lorenzo Bevilaqua/ABC/Getty

'The View' takes Washington

Talk of Midtown, talk of Tinseltown: In a new cover story for The New York Times Magazine, Amanda FitzSimons says ABC's "The View" has become Washington's "most important TV destination."

• ‘‘In the past few years... 'The View' has become a place where Democrats and Republicans alike go to introduce themselves to a national audience, an essential campaign stop."

• "Twelve of the 26 people who have announced that they are running for president in 2020 have already been on the show, with one more, Senator Elizabeth Warren, already scheduled."

• "Although ratings for 'The View' are up... the numbers aren’t high enough to explain why politicians con- sider the show an essential stop."

The big picture: "'The View' has become an influential political talk show because it isn’t one. ... The show also has an off-the-cuff-ness that the panelists and producers take seriously. ... What sets the view apart is [the audience's] fascination with the hosts."

• Bonus: While we're on the subject of influential daytime TV, Ellen DeGeneres has re-upped her show through 2022.

🇺🇸 What next: Exactly five weeks til the first 2020 Democratic primary debate on NBC News, MSNBC and Telemundo.

See you tomorrow.