60 Minutes Recap (10/7/12): Huawei and Luxotica - Foreign Co.'s - Taking Over U.S. Markets?

60 Minutes Recap (10/7/12): Huawei and Luxotica – Foreign Co.’s – Taking Over U.S. Markets?

Tonight on 60 Minutes, the story about the U.S. House Intelligence Commitee’s concern about the Chinese company Huawei posing a security risk to the U.S. tech industry and its citizens takes centerstage. Plus, Lesley Stahl interviews Italian company, Luxotica, who pretty much provides the eyewear for over half a billion people on the planet. Finally, Rodriguez, an American artist who flopped in the U.S. went from 40 years of obscurity to fame in ? where his music became even bigger than The Beatles. All of this tonight, recapped all for you below just in case you missed anything on tonight’s show.

Huawei world headquarters looks like Google’s HQ in China’s Shenzen. Unlikwe Google (or at least it seems), it’s an extremely top secret place. Its innovative technology especially in 4G has taken the world by storm and is now making its footprint in the U.S. Should we be concerned? Can we trust China? According to key members of the U.S. House Intelligence Commitee, no. “It’s a strategic industry where an opponent can gain an advantage against [us].”

How did Huawei get so big so quick so aggressively  One reason is industrial espionage. Two is its support and funding from the Chinese government. The American face of Huawei, Bill Plummer [sic], defends his company saying that “Huawei is Huawei; it’s not China.” Buying $6 billion dollars of components from American companies and hiring 35,000 Americans, it’s being said that Huawei is no different from Siemen’s and other foreign companies on U.S. soil.

But that’s all a facade as a former CIA agent Johnson shares. He reveals that Huawei’s founder and President was a former Chinese army general before he started the company. Unlike Western companies, the Communist Party of China actually has offices and decision-makers within the company itself. “It’s a different system than ours….In China, a company is a Chia pet.”

In the last couple of years, Huawei has managed to maintain and control quite a few rural telecom networks like in Kansas. An American company in Kansas wanted to use Huawei’s equipment. It was then that two U.S. Federal Agents paid a visit to this company, the story goes. The only U.S. company that can provide some (not all) of Huawei’s products is Cisco.  The House Intelligence Committee’s report on Huawei will be due tomorrow, and 60 minutes shares that Huawei is not going to be one happy Chia pet about it.

If you’ve bought glasses lately (except at Walmart and other similar stores), I bet your own eyeballs popped at the price. Mine sure did as I’ve been looking for a pair of prescription Ray-Ban’s that cost just as much as an iPad. But why are these pieces of plastic so expensive anyway? The simple explanation is the lack of competition. With over half a billion people wearing their frames, Luxotica has complete control of the market. it’s the company that took these once medical devices and made them into high fashion “eyewear” of “face jewelery.”

Coach, D&G, Tiffany, Ray-Ban, Versace, and all of the other brands we know and love, send off all of their designs to Luxotica and Luxotica produces them in mass. Why don’t we know Luxotica itself as a high-end brand? Not much$8 billion last year, and their best seller is actually a brand of their own, Ray-Ban. Ray-Bans used to only cost $29 a pair until Luxotica came in, refurbished the brand, and made them now all cost as much as $150. Luxotica says Ray-Ban is an American brand owned by the Italians. (Huh?) In fact, Luxotica owns and runs Lencrafters, Target Optical, Sears Optical, Sunglasses Hut, and so many more. It’s a monopoly. Oakley was Luxotica’s biggest competitor. When friction happened between the two, Luxotica dropped Oakley from their stores and Oakley’s stock plummeted. Luxotica bought Oakley in 2007.

What Rodriguez didn’t know was that he was more popular than Elvis and The Beatles in South Africa. From downtown Detroit, Rodriguez cut his first album “Cold Fact” and it bombed here in the U.S. His second album did no better. However, in South Africa, these albums were HUGE. It was the 1970’s and political apartheid and Rodriguez’s music all went hand-in-hand. Rumor had it that Rodriguez had burned himself alive in stage, but the fact checkers went out and found him in Dearborn, Detroit.

His neighbors had thought he was just another homeless person. But he wasn’t homeless. He was a day worker, the son of an immigrant, and (just like me) a Philosophy graduate. When the South Africans found him and flew him there, Rodriguez’s family was shocked to find limos and 5,000 people waiting for him in concert. Upon returning back to Detroit, it was as if nothing had happened. He went from day worker to rock star back to day worker. “There’s no shame in hard work. There’s no shame in being poor.” Rodriguez says.

But now, more is coming Rodriguez’ way as a documentary film (shot mostly with an iPhone and an app) gained traction at the Sun Dance Film Festival. Because of the film, he’s performed on David Letterman and now has a sold-out tour all across the U.S. And it took all of 40 years (he’s 70 now) for the rest of us to finally find him. Why did it take 40 years? Rodriguez says “Maybe I just wasn’t so lucky.”

Image Credit: 60 Minutes


  1. carin lugo says

    Thank you for your segment on Luxottica last night. I am an independent rep working for one of the “other” companies not owned by the “Italian Mafia” as we all call them. Twenty years ago when I did work for Luxottica they told us that soon they were going to buy up everything in the industry and bless them– they sure did. VERY interesting segment. Thank you Carin Lugo

  2. Tony says

    The idea that Luxottica has a monopoly on eyeglasses in the US is the a same as saying Starbucks has a monopoly on coffee. They are the largest but not the only one. Last time I checked you can get a cup of coffee for 50 cents or you can get a coffee from Starbucks for about six dollars. What is the difference? Quality. You get what you pay for. Same with glasses. You want quality you pay a little more.

  3. Joe says

    Please get your story straight…cole vision was Luxotticas biggest competitor. And the cost to make a pizza is $.50 yet we pay as much as $15 for one. we are not only paying for the cost of the frames and lenses we are paying for the optician, the lab tech and the facilities for the retail locations and lab locations. That is why a pair of glasses costs so much. However why do you need a rayban ?? You can purchase a no name frame for $79.

  4. georjean sherriff says

    I realize I’m not the sharpest knife in the drawer, but seeing your alarmingly scarey coverage on Huawei, I just don’t understand why USA allows them to import much less do business in our country when they are such a threat.

  5. Dave Miles says

    Are we the real Troy?

    If we allow Huawei Technologjes and ZTE Inc to expand their telecommunications operations in the US, we will begin to make real the Greek myth of the Trojan Horse. Troy’s leaders naively brought a mysterious object inside their attack-proof gates. We know what happened next. At best, we are told that China is a frienemy. We could become the real Troy.

    As a start-up entrepreneur and retired military officer about to launch a venture to protect us against natural gas explosions, I could see many years of research, analysis and experience evaporate before the business becomes profitable and lives are saved.

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