Huawei's latest blow could signal the end of its smartphone business

Huawei's latest blow could signal the end of its smartphone business
Google, Microsoft, Intel, Qualcomm, and many other companies have already cut ties with Huawei over the course of the past few days. But today the Chinese brand’s week just got a whole lot worse as British chip developer Arm Holdings has also ceased all cooperation with Huawei. 

Huawei no longer has access to the ARM chip architecture


Citing an internal memo, the BBC reports that the company behind the ARM architecture has told employees that its designs contain “US original technology.” As a consequence, it believes that it’s affected by Trump’s latest ban and has ordered that all “active contracts, support entitlements, and any pending engagements” with Huawei be halted immediately. 

It’s reported that the company also instructed employees to notify Huawei that, due to the “unfortunate situation,” it could no longer “provide support, deliver technology (whether software, code, or other updates), engage in technical discussions, or otherwise discuss technical matters with Huawei, HiSilicon or any of the other named entities.”

As another blow for Huawei, the ban also appears to apply to the chip vendor’s ARM China subsidiary which was set up just last year as a joint venture with the objective of developing, selling, and supporting products in the region, thus leaving Huawei without any access to the ARM architecture.

Huawei's latest blow could signal the end of its smartphone business
The information provided by the BBC reveals Arm Holdings informed some staff on May 16th and subsequently sent out the aforementioned memo on May 18th. Despite the US government issuing a 90-day reprieve on May 20th, though, sources within the company revealed that work with Huawei hasn’t yet restarted and an intention to do so hasn’t been communicated either.

If nothing changes, Huawei won't be able to create Kirin processors


Despite the fact that Huawei designs its own processors through subsidiary HiSilicon, these chips rely heavily on the ARM architecture. In fact, most of Huawei’s recent offerings utilize a number of ARM-based Cortex cores created by the British chip designer. 

Due to the ban, Huawei will no longer have access to the architecture or the custom cores. This means that Huawei and its subsidiary won’t be able to create chips for the company's future devices. The only way to do so involves finding a completely different architecture that doesn’t utilize US technology or developing a chip architecture of its own, something that would take years. But in this case, Huawei would face a separate problem – Android only supports ARM and Intel's x86.

Huawei's latest blow could signal the end of its smartphone business
According to the report, Huawei is free to continue manufacturing its existing chips, so the Kirin 980 used inside the Huawei P30 and Honor 20 lineups, and the Kirin 710 that Huawei includes in its mid-range devices are under no threat. Work on the next-gen Kirin 985 is also unaffected. However, this chipset hasn’t yet been completed, meaning that, as things stand, it can’t be finished and won’t make its way into the Huawei Mate 30 series that is planned for later this year unless Huawei rebuilds it from scratch. 

What does this mean for Huawei's smartphone business?


Huawei has been preparing for the worst over the course of the past few months by creating its own Play Store rival and continuing development on its Android replacement. However, the company didn’t expect to lose access to Google’s entire catalog of apps alongside many other American offerings.

Presumably, Huawei also wasn’t expecting any issues with Arm Holdings, something that could potentially lead to the company’s exit from the smartphone market. After all, while Huawei could survive without the software offered by American companies, the inability to create processors for its own smartphones means that, unless the situation changes, eventually it won’t be able to produce competitive devices. Huawei also may not be able to purchase chips from rival companies due to the fact that most are based on the ARM architecture.

Ultimately, only time will tell what happens to Huawei and its smartphone business. But if a trade deal isn’t reached soon between the US and China – Huawei is most likely being used as a bargaining chip by Trump – Huawei’s future could be pretty bleak.

Huawei's latest blow could signal the end of its smartphone business

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72 Comments

1. obedchuni

Posts: 315; Member since: Jun 16, 2014

Damn what will be the end.

37. raky_b

Posts: 369; Member since: Jul 02, 2014

Or, whole new start. And end of some monopolies...

41. sgodsell

Posts: 6895; Member since: Mar 16, 2013

Huawei will live on in China, especially since Huawei smartphones never had any Google apps or services over their to begin with, heck before the smartphone craze started, and even before that. China never allowed Google because they didn't allow any freedom of information over their, period. This is China, it's China way or no way in China. However since Huawei has to play by the rules of other foreign countries and abide with governing bodies for businesses in those countries. This is where Huawei has to follow the rules laid out by other governing bodies, as well as any patents that are in place. Not to mention other things like espionage. If Huawei doesn't have access to the Play store or any of Google's services, then that will definitely hurt Huawei. Huawei can come up with their own OS, and their own app store. However if this new app store has copied or has placed apps from other companies on their app store, then naturally Huawei's app store will be shutdown. Think about it, if Microsoft office is found on Huawei's new app store without Microsoft placing that app their, then Huawei will be stopped. Huawei needs the developers explicit permission to use their apps on their new app store. That alone is a huge hurdle for Huawei.

43. Macready

Posts: 1811; Member since: Dec 08, 2014

Did you even read the article? This is about chips. They lose access to the core of their chip design, including support. Insiders say that Huawei is at least 2 years away from full ARM chip design independence. That's 2 years too long.

46. TheOracle1

Posts: 2074; Member since: May 04, 2015

Three words: Rare Earth Minerals. Look it up. End of trade war and the US concedes.

53. bigstrudel

Posts: 574; Member since: Aug 20, 2012

Lol not really man when you consider China has to import rice to feed its population and has total dependence on foreign oil deposits. Look it up.

60. TheOracle1

Posts: 2074; Member since: May 04, 2015

There are plenty of willing oil and rice suppliers out there. Look it up.

61. mootu

Posts: 1421; Member since: Mar 16, 2017

China can get all the oil it needs from Iran and Russia.

2. AbhiD

Posts: 613; Member since: Apr 06, 2012

Oh boy! This really is the worst outcome of the ban for Huawei. They are literally dead now until Trump changes mind in his typical fashion. Although even if Huawei gets access later on, there will forever be extreme uncertainty over Huawei's future and operations. Their goose is cooked! And i definitely want Huawei to go down. Never seen such a shoddy company involved in malpractices, lies, deceit, stealing trade secrets.

7. alanrock

Posts: 264; Member since: Oct 04, 2018

freedom fighter you are ...

11. Back_from_beyond

Posts: 1239; Member since: Sep 04, 2015

Really? Never seen another company quite like that? That's odd, I can think of several and most of them are American.

54. bigstrudel

Posts: 574; Member since: Aug 20, 2012

Examples please. You can’t provide them I’ll spoil the ending.

63. vikingsfootball09

Posts: 111; Member since: Oct 02, 2013

funny that the accuser (the u.s.) is also spying on other countries using tech and espionage tactics...its like a cheating husband accusing his wife of cheating LOL

19. QuantumRazer

Posts: 36; Member since: Apr 27, 2019

"And i definitely want Huawei to go down" At least you should've tried to hide your bias in your comment if you wanted it to be seen as an objective opinion.

55. bigstrudel

Posts: 574; Member since: Aug 20, 2012

He clearly didn’t mean for it to be objective. Are you low IQ bro? Can’t understand what you’re reading?

64. vikingsfootball09

Posts: 111; Member since: Oct 02, 2013

maybe he didnt mean for it to be objective, but he did seem to have a Trump attitude.

67. QuantumRazer

Posts: 36; Member since: Apr 27, 2019

Correction: not "objective opinion", should've been "valuable opinion"(Opinions cannot be objective, jeez why didn't I proofread before I submitted this comment)

27. oldskool50

Posts: 769; Member since: Mar 29, 2019

I see, you're one of the dummies who just believes everything you hear. The US has produced zero evidence that Huawei every committed any crime. I believe this is the conversation Tim Cook had with trump. To block Huawei to prevent them from beating Apple. When lawsuits fail, just get the US Gov't guard dog involved and all will be made right for Apple. You should go and read the facts, because you're wrong. Like Trump, you're completely ignorant.

33. apple-rulz

Posts: 1901; Member since: Dec 27, 2016

Techiexp you are mentally ill, that being said please produce evidence to bolster your claims.

44. jacky899

Posts: 401; Member since: May 16, 2017

Apple doesn't have much to gain from this because IOS products are not threatened by Android products. If anything, I would imagine Tim Cook would try to persuade Trump not to attack Huawei incase China would retaliate against their US counterpart by banning Apple sales in the lucrative China market, where Apple has made 1/3 of their profits from, which is more than all Chinese phone companies combined all these years. This whole anti-Huawei propaganda is solely based on accusations without proof and is not unlike the Iraq war where the US gov got everyone gung-ho about destroying Iraq on the basis that they were secretly developing nuclear weapons, as purported on the US media on a daily basis. After bombing most of the main cities to ground zero killing millions of innocent families there, it was later "hardly mentioned" on the media that they had no weapons of mass destruction nor were they developing any. The whole war was for the US to secure their interest in the oil rich Middle East. This is how government propaganda works. Media outlets are used to deceive the public to garner support for the government's inhumane crimes. This is not specific to the US.

57. bigstrudel

Posts: 574; Member since: Aug 20, 2012

The pro Huawei propaganda which you’ve consumed is straight out of American media which China owns a ton of as well as most of Hollywood.

48. ScottsoNJ56

Posts: 90; Member since: Oct 01, 2017

Talking about being ignorant.....

56. bigstrudel

Posts: 574; Member since: Aug 20, 2012

You know what I find interesting is you have all these people saying that it’s wrong and have no evidence that Huawei has done anything. The United States doesn’t make promises to open it’s market to everybody. If we don’t want you here you get to get the f**k out. Period. Foreigners these days are so entitled they act like everything in the US is theirs also.

3. jasaero

Posts: 46; Member since: Oct 20, 2014

Seems this is likely a false rumor if the following is true and patented tech that is not actual product can't be touched. Seems to be lots of rumor and speculation still. Hard to tell which is which. Yahoo Finance: Interdigital, Qualcomm Expect to Bypass Huawei Trade Ban.https://finance.yahoo.com/news/interdigital-qualcomm-expect-bypass-huawei-134701096.html

14. Droid1

Posts: 28; Member since: Oct 06, 2017

They haven't paid Qualcomm in licensing fees since 2017

4. User123456789

Posts: 587; Member since: Feb 22, 2019

Mediatek is Taiwan, not China

5. joshuaswingle

Posts: 489; Member since: Apr 03, 2018

Oops, my mistake! Thanks for pointing that out :)

6. surethom

Posts: 1618; Member since: Mar 04, 2009

I bet if ARM was Still a UK company, this would not happen, they would wait for USA to issues a statement direct to ARM.

20. QuantumRazer

Posts: 36; Member since: Apr 27, 2019

ARM is currently owned by a Japanese company Softbank. And as far as I know Japan is one of the most pro-American country in the world, so their decision is somewhat understandable.

8. surethom

Posts: 1618; Member since: Mar 04, 2009

When i get my next phone my Huawei Mate 10 Pro will be worthless on Ebay, thats how i fund my next phone purchase.

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