Huawei Controversy: Effect on Huawei and US Technology Market

Recently, China and USA have been engaging in trade war. This weekend the US government has restrict his technology companies from selling to any company that harm national security. This law is aimed at Huawei which is a Chinese company and the second largest phone producer in the world.

Huawei has been previously accused of spying on it’s user which they deny. Google which is owned by Alphabet has officially stop trading with Huawei which includes transfer of hardware, software and technical services. However, Huawei phone will be able to access those that are available on open source licencing.

Implication On Huawei Products

The implementation of this is that Huawei won’t be able use Google’s Android operating system, meaning they will not be able to update. Huawei smartphone that will be produce later will never be able to access Google apps like Gmail, YouTube, and the Google Play store.

Another implication is that, the aim of Huawei to leave the 5G technology might become almost impossible because it depend on US company for most of it’s part.

However, it’s not only Google that will not be trading with Huawei, American chipmaker like Intel, Qualcomm and Broadcom will also stop supplying Huawei. The Nikkei Asian Review also report that Infineon, German chipmaker has also stop supplying Huawei.

The restriction on US tech company from trading with Huawei came after Trump’s administration declare national emmergency on foreign company that serves as threat to US security.

Way Forward For Huawei

In March, the CEO of Huawei consumer product devision, Richard Yu told a German newspaper that Huawei has prepare it’s own operating system if they loss access to Android. However, he said that they will prefer to work with Google and Microsoft. A report also has it that Huawei has already have many chipset in stock to continue production for months.

Huawei subsidiary, HiSilicon also produces it’s own CPU and GPU for there smartphones.

Implication Of Huawei Ban On Apple

The ban of Huawei by US is like stepping on Chinese pride since Huawei is one of the few China-based OEMs with international recognition. There is also an uproar in China that US is trying to disrupt Huawei from competing in the West to give way for US technology.

Since China is one of the biggest smartphone market in the world, it’s a very important region for Apple. Apple has been a subject of protest and boycotts previously in China and it is now considered embarrassing to own iPhone in China.

Apple is generating 17% of it’s revenue in China and they are important for their future. Any weak sale in China will affect the company’s revenue in the long-run. Also, their is possibility that China will retaliate by telling Foxconn not to do business with US tech company and that will be a big shot.

Effect Of Huawei Ban on US Technology and China

The ban on the Huawei is going to have impact on both nation and technology community. The Huawei 5G the is considerable less expensive. For US to use the product from other supplier, it will be at a higher cost. Also the two other big supplier in the industry; Ericsson and Nomia are not American company.

Huawei relationship with other countries in Europe is stable for now. But their is possibility that more countries might join US suit on Huawei. Australia has also ban the company but it seems no other country is likely to join as Huawei 5G is less expensive to others.

However, the time industry is getting g more mature and not dependent on US technology provider.

If other countries did not join US to ban Huawei it won’t have much effect on them. But of they do so it is a big problem for them and it will also limit players in telecom space. US technology market will also loss a whopping of $11 billion coming from Huawei for buying.

We think Huawei Ban will not only affect Huawei alone, it will cost me back to have a bad effect on Apple and US technology. 

What did you think about Huawei Ban? Let us know in the comment box.

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