Things appear to be going from bad to worse for Huawei, as a result of the US sanctions which will come fully into effect on September 15 (even though many companies have already stopped working with Huawei). It’s not just impacting on its American partners though, as we have heard that Taiwan based TSMC is looking to stop manufacturing semiconductors for the company and now Samsung has revealed that they will do the same.
Samsung might be seen as its biggest competitor in the smartphone space, but it is also an important chip manufacturer that supplied some of the components used in select Huawei devices. Huawei’s strategy, of course, is to try and manufacture themselves out of the problem through their own chip division, but another ruling which places restrictions related to a ban on non-American companies selling components that were developed with US technology is perhaps even more crucial here, as Huawei’s own Kirin chipsets are based on US designs from Qualcomm.
The whole thing continues to be a bit of a fiasco, as although Huawei is easily going to be most crippled by this, other companies will also lose out on their business. Especially if Chinese efforts to fund a semiconductor business of their own prove successful. Without Google services, Huawei phones are already pretty useless for many people, but if they run out of chips to manufacture them with, they may just become valuable souvenirs of the past.
Oddly enough, Chinese mobile phone manufacturer Xiaomi has not been sanctioned in any way by the US government and could be a big gainer in the smartphone wars. It could only be a matter of time if they get too big though, before we see them possibly facing similar problems.
Last Updated: September 10, 2020