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The US ban on Chinese tech giant Huawei officially takes effect on Tuesday, excluding the world’s largest smartphone and telecommunications equipment provider from all providers whose products contain US technology.
Over the past week, some of Huawei’s top chip suppliers, including the world’s largest contract chip maker, Taiwan Semiconductor Manufacturing Co (TSMC), and South Korean memory chip makers Samsung and SK Hynix, they confirmed that they had to suspend the company’s orders after September. 15 without a license from the U.S. Department of Commerce.
Expert: Huawei will continue to have chip supplies from Chinese companies
At a forum on China’s information technology development last week, Ni Guangnan, an academic at the Chinese Academy of Engineering, said Washington’s chip embargo does not mean that Huawei will not have chips to use.
Although Chinese companies do not have the 7nm and 5nm manufacturing capabilities required to produce the most advanced smartphone chipsets, they are capable of producing 28nm and 14nm chips, which are good enough for most electronic products as well. of the phones, he explained.
That means only chips for smartphones would be affected, while those for telecoms gears would be basically unaffected, according to Ni.
The telecommunications equipment business and the consumer products business (mainly smartphones) have been the two pillars of Huawei’s operations, contributing around 35 percent and 56 percent, respectively, to its total revenue in the first half of 2020, according to its financial report.
Despite the US lockdown, Huawei’s share of the global telecommunications equipment market reached 31 percent in the first half of this year, maintaining its number one position worldwide, according to a report by Dell’Oro Group, a leading market research and analysis firm.
Screen shot of the Dell’Oro Group report.
Screen shot of Dell’Oro Group report.
How will Huawei’s phone business be affected?
Huawei’s smartphone business appears to face more uncertainties.
Richard Yu Chengdong, chief executive of Huawei’s consumer products arm, said in August that the company would not be able to make its self-designed high-end Kirin chips for smartphones after September 15.
Its next flagship Huawei Mate 40 phone, equipped with Kirin 9000, could be the latest generation of Huawei phones with its own chipset, Yu said.
Although its suppliers have been rushing to provide a final batch of inventory to Huawei over the past few months, industry experts estimate that the company’s stockpile of chips can only sustain its phone shipments for half a year.
Huawei’s smartphone shipments surpassed 240 million units in 2019, surpassing Apple to become the second-best-selling brand worldwide, according to Yu. In the first half of 2020, the company shipped more than 105 million phones despite slow global demand. Yet analysts expect Huawei’s smartphone shipments to drop to just 50 million units next year, as a result of the toughest restrictions in US history.
‘The stars shine even in the darkest night’
At the Huawei 2020 Developer Conference held last week, the company unveiled its self-developed enhanced operating system – Harmony OS 2.0, which will not only be available for its smartphones, but will also enable multiple Huawei products, such as televisions, Tablets and laptops work together seamlessly and provide an optimized user experience.
Wang Chenglu, head of software for Huawei’s consumer business branch, said that the interaction between HarmonyOS 2.0 devices will be much faster than current cross-device solutions.
Huawei is also building a device ecosystem with other electronics manufacturers. “Ovens, refrigerators, cars and many other third-party products with HarmonyOS 2.0 will be available soon,” said Wang.
Read more: Huawei’s HarmonyOS 2.0 Coming to Smartphones in 2021
This has been seen as a major move by the company to break away from US repressions.
“The stars shine even in the darkest night,” Yu said at the conference.
“A year ago, when Washington restricted Huawei’s access to the use of Android on its smartphones, many had thought that Huawei’s smartphone businesses would be destroyed,” said Xiang Ligang, CEO of the Information Consumption Alliance, an association of the telecommunications industry.
But instead, Huawei developed HarmonyOS and even went from being the world’s second smartphone provider to number one in the second quarter of 2020, Xiang said.
“The process showed what Huawei was capable of doing amid intense pressure, and offers a hint of what Huawei can do to survive the latest chip restrictions, which are believed to have the potential to hurt its phone business. smart, “he added.
(Cover: File photo of a Huawei store in Xiamen./VCG)
