Could it have been something like Stellar Wind https://en.wikipedia.org/wiki/...
" by four major lines of intelligence collection in the territorial United States together capable of spanning the full range of modern telecommunications"
"The program's activities involved data mining of a large database of the communications of American citizens, including e-mail communications, phone conversations, financial transactions, and Internet activity"
If you have 1h 20 mins free consider watching "29C3 Panel: Jesselyn Radack, Thomas Drake, William Binney on whistleblowing and surveillance" https://www.youtube.com/watch?...

Voice prints, key words, known callers are so 1980's. Collect it all is now the mission. Then sort.

US peering is cheap so international telcos would loop calls via the US to save cash.
Domestic calls would pass the same regional optical splitter sites.
Add in shared sites and 5+ other helper nations the global coverage is vast.

Would you risk your wage, good apartment, work, clearance, international travel, health care, pension, rank on been reported with consumer telco junk?

The phone would be ship with a local version of an international treaty like
https://en.wikipedia.org/wiki/...
If it is for sale and connects to your nations phone towers: call voice, location, tower dump, images, mic turn on would all be a nice list of law enforcement options.
Its in the hardware and software layers that no average user can see but would be dual use to make the call on your telco network. You input a number or letter it is 'sent' as part of the networking or kept in memory as part of its normal user functionality. So yes new clean telco layer "code" could find its way down onto your phone as they just track your phone per tower.
re what could we do about? Meet face to face without a phone? Buy a type writer? One time pad on paper? The phone as offered in many countries is a tracking beacon, camera, live microphone for voice prints, web bug and key logger :)

Re The Russian CPU is guaranteed to ...... just be a cpu
A Russian cpu would be like a cpu made in China - a cpu that can do some computing tasks at a price and speed that is still useful without questions surrounding its import, a stop over when shipped as part of a larger system. Jobs, security, growth and a full understanding of every aspect of the cpu design.

The NSA and GCHQ have always wanted more info on China. From flying drones Lockheed D-21 https://en.wikipedia.org/wiki/... to funding CIA Tibetan program https://en.wikipedia.org/wiki/... to using commercial shipping to gather signals intelligence.
China has its own brands of phones to sell, domestically and globally. Why risk staff wondering around with product lines mentioned in connection with foreign intelligence services?

Re Carter http://www.salon.com/2013/07/1...
It was an interesting decade with Halloween Massacre https://en.wikipedia.org/wiki/...

Re OT, I saw the ASIO lyrics a few days ago linked from a slashdot comment and added the sig.

Re 'My feeling is that European countries want to be friends with the US, because otherwise they get bullied by Russia."
The EU had 2 options - find its own oil and gas globally in the 1950's-70's and undercut protected US/UK oil brands with all the distant start up costs.
Enrico Mattei views on big oil and finding Italy much needed cheap energy
https://en.wikipedia.org/wiki/...
https://en.wikipedia.org/wiki/...
Option two was buy gas from the Soviet Union at set rates with new pipelines.
The Soviet Union and Russia was paid on time and kept to the letter of the contracts with the EU.
The EU and Russia seem to have a new vision of energy exports
Russia Rushes To Seal Ukraine-Bypassing Gas Pipeline: Lavrov Pays Bulgaria A Visit (07/07/2014)
http://www.zerohedge.com/news/...

Re Germans would riot (literally) if the US planned to close the base. It is a huge source of jobs, jobs that would otherwise go to US contractors but instead go to local German contractors.
UK and US sites have closed. The locals are unhappy but decades later an understanding of what been occupied is really all about is emerging.

Germany wants its own gov staff back. Germany wants its own trade deals in private. Germany wants its science and banking back. Germany wants its telco sector back. Germany wants its staff to be good Germans, not more loyal to "Five Eyes" plus other nations every working day. Germany wants its own domestic and foreign policy back from the US and UK.
Setting up 'manipulate them through false information instead?" is tricky as West Germany found out. If the staff around your top political leaders work for East Germany - just setting up 'false information' might be noted.
If the tame cleared German staff around your top political leaders work for other nations - just setting up 'false information' might be noted.
So German is been cleared up in public. That reduces any security advantage hidden/cleared German staff have to re invent their pasts helping Western powers.
That reduces any press advantage hidden/cleared German staff pasted to helping Western powers to slow the investigations down.
The Western press spin of protecting German from "commienazis" may not work so well this time.
Re 'What are the implications here?" Germany trades with the world as Germany again, not Germany with 5+ other nations having some real time advantage for their own brands and firms.
German industry can emerge again to trade fully with the world.
No more wondering why Germans where been frozen out of a trade deal or under cut by 5+ other nations again and again.. over decades.

Re "And yet their own intelligence agencies have no issue with sharing and working with the NSA."
The West German "intelligence agencies" grew out of ww2 - some where never vetted, some had their files lost or re written, some where invited in due to needed Soviet skills- no questions asked.
Over time they selected new staff, where exposed due to their ww2 crimes or retired. The next generation was guided into a world of expensive technology to help the NSA, CIA and GCHQ understand and shape the West German teclo system.
Great work, nice pay, dreamy budgets and on the winning team. This went on for decades and the West German staff got very comfortable ensuring the copper and later optical systems worked as installed by the USA. The GCHQ and NSA enjoyed full access to all aspects of West and later German telecommunications with the full help of tame, local German staff per site.
At some point other groups within the German gov would have had enough of all their communications, trade negotiations, science, politics just flowing to the UK, USA and a few other competing countries for free every day thanks to tame German gov and private sector staff.
At some point a white list of tame US and UK helping German staff with telco site/file access would have been created to ensure site access and pass/paper work.
Perhaps other groups in the wider German gov now have a short list of German telco experts/gov staff who are more loyal to the USA/UK than German.
Once the questioning starts beyond now 1 or 2 and grows to 10's, 100's will the US and UK offer their German helpers passports, pensions and residency outside Germany?
Like the nice interpreters get after other occupations are over.

The fix is in for Australia https://en.wikipedia.org/wiki/... ie spend big and you get extra updates.
Australia never wants to face the lack of support it had over issues like radar warning receiver (RWR) and EW threat library information.
Having to fix your imports is hard and very expensive. Australia was not facing the East European threat library. Australia was facing Asia importing US platforms.